Jumio Looks to Reduce Fraud, Hassle of Mobile Transactions
As viruses like Heartbleed and security breaches like Target’s massive credit card data hack become more and more common, it’s obvious to Jumio CEO Daniel Mattes that our current online security measures just aren’t cutting it. Basic security precautions like questions about your mother’s maiden name are useless in the age of social media. “These days with Facebook, believe me I will very easily find out,” he says. “All those knowledge-based authentications are not that secure anymore. It’s getting to the point where documents and biometric-based authentication is necessary.”
At the same time, retailers and other vendors don’t want to increase the hassle of online transactions, which can lead to abandoned shopping carts. Mattes says he started Jumio to develop strong authentication and security solutions that will prevent fraud, but won’t adversely affect the consumer experience.
He first got the idea for the company when he was a frustrated customer himself. A few years ago, he was on vacation in France and needed to buy a plane ticket for a friend. What should have been a simple transaction was enormously complicated. Mattes was trying to use a card issued in Austria, working from a computer with a French IP address, and trying to buy a plane ticket in someone else’s name. He had also recently changed his billing address, so the records the bank used to cross-reference his identity were out of date. The whole thing looked understandably sketchy, and he spent four hours of his vacation on the phone with banks and credit card companies trying to verify that he was in fact who he said he was.
At the time, Mattes already had experience dealing with fraud prevention. His previous company, Jajah, was the first peer-to-peer Internet telephone company to use VoIP (voice over Internet protocol.) As criminals realized that they could monetize stolen credit card numbers by buying and selling VoIP services, Mattes and Jajah had to develop verification protocols to help fight fraud.
His previous work experience and the unfortunate four hours he spend on the phone in France made him realize that there had to be a better way. He set out to make the online experience as seamless as buying a cup of coffee at Starbucks, where customers can swipe a credit card without ever showing identification. The answer, he realized, was the camera phone. “Why not use the camera and turn your smart phone into a credit card and ID reader?” he says. “That was the core idea.”
Mattes started Jumio in 2010, with the aim of creating products that would promote higher transaction completion rates, increased revenue, and reduced fraud and chargeback costs, primarily for mobile apps.
Over the past four years, the Palo Alto-based company has raised … Next Page »