6 Digital Identity Verification Startups to Check Out
Most people don’t think much about privacy when they search for things on Google, and even more are probably oblivious to just how much information you tell Google about what’s going on in your life. It has now become standard practice to evaluate someone’s Google searches for murder cases, oftentimes uncovering things like “how quick does concrete dry”, “how to poison someone”, or “how to get someone to stop talking about politics all the time”. The fact is that your digital persona knows more about you than anyone else does, even you. Murder cases aside, the people who are most interested in knowing about you are marketing people who want to sell you isht. Up until now, tracking who you are has been limited to the use of a “cookie” which simply lets a website know that you’ve visited before and when. It also tracks your “session” on the website so that a user profile can be built around that. Now, we’re moving into a new era when it comes to online digital identity.
Digital identity can be divided into two general areas. Soft digital identity is the type used for marketing that doesn’t have much risk associated with it. Try to sell a vegan beef jerky and it’s not the end of the world. Hard digital identity though is a different story. If you let someone open up a bank account and they aren’t who they say they are, you could end up paying thousands of dollars in fines. In our last article on 9 Regulatory and Compliance Regtech Startups, we looked at a number of solutions that are helping big financial institutions from getting fined for doing bad things – like facilitating money laundering. In this article, we’ll look at 6 startups that offer digital identity verification and background checks.
Founded in 2005, San Jose startup ThreatMetrix is “the digital identity company” and they’ve raised nearly $62 million to make that happen. According to a bunch of MBAs over at Forrester, ThreatMetrix is the leader in risk-based authentication and their platform protects everything from logins to payments. Here’s a really cool looking periodic table that shows the extent to which their platform covers just about anything and everything under the sun:
It’s easy to see how they’re a leader when you consider they verify more than 20 billion transactions annually across 30,000 websites.
Founded in 2014, San Francisco startup Checkr has taken in just over $40 million in funding from investors that include Google Ventures and Accel Partners. The goal of the startup is to automate the process of background checks, so not just making sure you are who you say you are but that you’re also not a bad person. Fast Company wrote an interesting article which talked about how Uber does background checks (they use Checkr), and talked about how even though some people think that background checks without fingerprints are largely worthless, Checkr says their methods are just as good and cheaper (in California, for instance, are between $25 and $42 a pop). Here’s why you should use Checkr:
More than 4,000 businesses use Checkr’s technology which integrates with all leading HR portals and uses “advanced artificial intelligence technology”. We’re pretty sure that everything out there could benefit from a little bit of “advanced artificial intelligence technology”.
Update 09/19/19: Checkr has raised $160 million in fresh funding to expand internationally, past the U.S. and Canada where it got its start in 2014. This brings the company’s total funding to $309 million to date.
Founded in 2012, this startup out of London England has taken in $30.3 million so far from a whole slew of investors that include CRM giant Salesforce (NYSE:CRM) in order to “welcome more people on board using machine learning technology wherever they are“. They offer a whole menu of “checks” in addition to just verifying your identity:
With over 1,000 clients globally, their solution is targeted at the “sharing economy” so that the person sleeping in your bed is who they say they are. You can also use it for Airbnb, pre-employment screening, or just general Know Your Customer (KYC) and Anti Money Laundering (AML) checks. It’s device agnostic and works in more than 130 countries.
Founded in 2012, New York startup Socure has taken in $29.4 million in funding from a whole slew of investors including Spanish bank Santander to develop “digital identity verification from trusted online/offline data like social media, email, phone, or IP address“. This means that Socure uses over 1,500 different variables to assess the likelihood that the person on the other end is who they say they are. Here’s a look at some of them:
Turns out that all those personal details that people so willingly vomit all over their social media channels are being put to good use by Socure’s machine learning algorithms. Tier-1 financial institutions are able to reduce fraud by up to 80% for credit card issuance and banking applications with “manual reviews” of applications cut by up to 90%.
Our next startup addresses digital identity verification in the healthcare industry. Founded in 2012, Virginia startup Verato has taken in $25 million in funding from investors that include top-tier venture capital firm Bessemer Venture Partners. The tool they are developing can rightly identify individuals regardless of whether their names, addresses, or other personal information is incorrect or out-of-date.
If you recall from our recent article on medical imaging, there is a lot of medical data floating around out there. One way to connect all this data is through a Master Patient Index or MPI which is a method of identifying a single patient across disparate IT systems. Duplicate medical records are a huge problem as more data continues to be generated and organizations consolidate EHR systems not to mention all the records held by insurance companies and the government. Plug in Verato’s cloud-based solutions and they’ll match all the records to unique patients with a 98% success rate that doesn’t require super clean data:
It’s the first cloud-based, nationwide MPI that any organization can use by simply plugging into it. The system is massive, containing 3 billion demographic data points, 300 million unique patients, and it’s updated 60 million times a month.
Founded in 2011, Canadian startup Trulioo has taken in $23.3 million in funding so far from investors that include American Express. Trulioo is a global identity verification company that offers instant identity and addresses verification for its users. The key word here is “global”, as Trulioo has 200 global data sources they use that can be used to verify over 4 billion people in 60 different countries. Here’s an example taken from the U.K.:
They can even access mobile network operator data. In some countries we’ve traveled to like Africa, your cell phone is not only used for playing Candy Crush but also to pay for things and as a method of uniquely identifying who you are.
Update 09/17/19: Trulioo has raised $52.8 million in funding led by Goldman Sachs to enable the scaling up of operations in new markets and the addition of 70 people to its 130-strong workforce across offices in Vancouver, San Francisco, and Dublin. This brings the company’s total funding to $80.8 million to date.
Our last company merits a mention even though they’ve been acquired and wouldn’t be considered a startup anymore. Founded in 2010, this startup had taken in nearly $52 million in funding from investors like Citibank and Andreessen Horowitz. Things started to go pear shaped when the CEO resigned in 2015 and Jumio told investors they would need to restate their financial results. Nothing like a company that offers trust solutions having trust problems, right? In March of 2016, Jumio announced that they couldn’t raise additional funding (probably because nobody trusted them anymore) and they were then acquired by an investment firm called Centana Growth Partners. Jumio uses computer vision technology to verify credentials issued by over 200 countries in real time web and mobile transactions. Here’s how it works:
In that last step, they actually use “eyeball tracking” to ensure that you’re actually holding the device and you’re alive based on tracked movement of your eyeball. The additional biometric capability that uses the iris makes this one of the most sophisticated ID verification solutions on the market today.
The emergence of the “sharing economy” means that companies are looking to develop their own verification solutions or acquire them. Just this past June, Airbnb acquired Trooly, a startup that had taken in $10 million in funding from the likes of Bain Capital. In addition to these types of companies that offer cloud-based solutions accessible via API, there are also startups that allow consumers to “own their identity” and then authorize it to be checked as needed. But that’s a topic for a whole other article.
If you like this topic, be sure to check out our article on “behavioral authentication” which our inner nerds find to be nothing short of fascinating. Many online banks use this method of authentication which identifies you by how you type your name (nobody types your name like you do) or the way you jiggle your mouse when they intentionally make the cursor disappear to “test you”.
Want to know what 30 tech stocks we own right now? Want to know which ones we think are too risky to hold? Become a Nanalyze Premium member and find out today!