In late January 2022, Estonia gained its sixth tech unicorn after identity verification startup Veriff raised $100 million in Series C funding. Veriff is an identity verification and know-your-customer platform ( AI-assisted KYC) used by businesses around the world to ensure their customers are who they say they are. Most of the company’s biggest customers are in the global fintech sector, where it faces competition from authentication and verification services such as Jumio and Fido.
Veriff is now valued at $1.5 billion, joining the ranks of Skype, Playtech, Wise, Pipedrive and Bolt in the ever-growing line of Estonian tech startup darlings. “It’s great that it’s done, but we can’t rest on our laurels,” Kaarel Kotkas, founder and CEO of Veriff, told ZDNet. 27-year-old Kaarel Kotkas began experimenting with web and verification technologies while still in high school. He eventually caught the attention of fintech Wise (then called TransferWise), who wanted his help testing their security systems with fake credentials.
In 2015, after his short stint at TransferWise ended, the entrepreneur set to work to found his own company. Three years later, Veriff has set itself the goal of becoming a household name in the global identity verification market. In an already crowded ID ecosystem, Veriff prides itself on the sophistication and accuracy of its authentication engine: a key concern as AI-generated fakes become increasingly compelling.
“In the financial sector, the identity verification process has traditionally been based on three photos that the user must send: a photo of their face and photos of both sides of their document, whether it is a passport or other form of identification,” explains the Veriff donor.
Focus on fintechs
“But in the era of deepfakes, it’s pretty cheap and easy to manipulate those photos.” To make fraud harder (and more expensive) for fraudsters, Veriff’s platform relies on video capture rather than still images to verify user identities. It intersects these images with the user’s ID document (Veriff supports up to 10,000 types of ID documents), then combines them with additional data points to ensure that a real person stands in front of the camera, and that she is who she claims to be.
Kaarel Kotkas claims that, under the right conditions, just five seconds of video footage can provide 300 frames for Veriff’s platform to analyze. In total, Veriff’s authentication technology uses more than 1,000 data points when making verification decisions, with Kotkas noting that the more data points the platform can analyze, the more accurate its system is, allowing the company to eliminate subjective human involvement from the verification process.
“We have all kinds of other data, like device data, video data [et] behavioral data, which helps us understand if it’s a real person live on camera,” he explains. Veriff intends to use the considerable funds it has raised in January to hire and do research and development.Three years ago, the company had 200 employees and only one salesperson.Today, it has more than 400 employees in Estonia, the United Kingdom, Spain and in the United States, and plans to continue to grow.
Growing investments
As part of R&D, Veriff will invest in improving the technical accuracy of the verification process. Kotkas estimates that there are some 10,000 different devices and more than 10,000 types of identification documents worldwide that can be used for identity verification, and Veriff wants to be able to use them all with precision. sufficient. Veriff isn’t just targeting fintechs: the company sees several sectors where identity verification will prove critical, which it plans to pursue.
“We are seeing a lot of new use cases, such as account recovery,” says Kaarel Kotkas. “For 20 years, the traditional way to do this was to provide a phone number or email address. But it’s clear that today it’s not the safest option to protect your account. There are so many new businesses that need to look into account recovery options, which means we now have a larger segment of customers.”
The entrepreneur nevertheless recognizes that the growth of Veriff’s reputation is largely based on the trust and recognition it is able to obtain in global markets, as well as within households. “It’s like in e-commerce: nobody wants to enter their credit card number on a random website, but if they know that the payment process is handled by PayPal, Adyen or Stripe, they trust it. That’s what we want to achieve with Veriff as well.”
Source: ZDNet.com