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Tema launches active ETF platform

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Tema ETFs has announced the launch of its ETF platform focused on what it describes as ‘expert-led, institutional grade thematic ETFs’. Tema, led by founder Maurits Pot and backed by fintech and asset management firms, writes that it will launch proprietary strategies in the first half of 2023. 

Tema writes that it is underpinned by a next generation end-to-end infrastructure solution that will also allow the turnkey launch of ETFs by external fund managers. In doing so, Tema will expand access to top tier investment managers and innovative themes for the benefit of the entire investment community.

Tema has also announced the investment led by Index Ventures and Accel and joined by Zinal Growth, in what it describes as the largest venture capital funding round in ETFs to date. 

Other investors include Jane Gladstone (fintech pioneer), Jonathan Rubinstein (former co-CEO Bridgewater Associates), Martin Gilbert (founder Aberdeen Asset Management), Michael Spencer (founder ICAP and NEX), in addition to several other prominent founders, executives and large family offices, the firm says.

Tema’s proprietary ETFs will be actively managed by internal fund management teams with years of deep industry expertise in each defined theme, the firm says. These themes include underpenetrated areas across reshoring, biotechnology, financial inclusion, environmental commodities, regulated monopolies, the Asian middle class, and dominant consumer brands.

The global ETF market has grown tenfold to USD10 trillion in assets in the past decade and is expected to reach USD20 trillion by 2026. This decade was defined by passive ETFs, representing ~95 per cent of global ETF assets today, with the active asset class still dominated by expensive mutual funds.

The active ETF asset class is half the age of its passive counterpart, yet it represented the majority of ETF launches over the past 18 months. As of Q4-2022, global active equity ETF assets remain below USD150 billion, versus over USD20 trillion in active equity mutual fund assets. This comparison underscores how nascent the active ETF industry remains, despite its accelerating growth.

“The past decade witnessed the start of the democratisation of capital markets access globally, pioneered by leading fintechs including Robinhood and Revolut, who have given access to existing financial products to a broader set of customers,” says Jan Hammer, Partner at Index Ventures, “Tema leads a new era of innovation in financial services that will result in the creation of new products.”

“We‘ve been impressed with Maurits and the Tema team’s vision to build a turnkey active ETF platform – an exciting and emerging category of the asset management industry,” says Luca Bocchio, Partner at Accel. “The team’s experience and execution rigor stands them in good stead to deliver innovative product offerings to retail investors.”

Tema’s ETF infrastructure solution will further democratise and unlock access to novel institutional ETF strategies through a turnkey, distribution-enabled ETF issuance product, the firm writes. 

“Best-in-class institutional asset managers have been largely inaccessible for most retail investors,” says Pot. “We see the ETF vehicle as the best way to broaden institutional product access for retail and mass-affluent investors and look forward to launching this solution later this year.”

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