Simplifide Raises $1M for User Authentication Software
Simplifide, a Madison, WI-based startup that’s developing technology to verify identities based on physical characteristics, says it has raised $1 million from investors.
The company, launched earlier this year, is on the verge of signing its first customer and is discussing conducting pilot projects with a handful of organizations in the U.S. and Europe, says co-founder and CEO Jeff McAllister.
Currently, the number of Simplifide employees is in the single digits, McAllister says. However, he plans to add staff using some of the proceeds from the recent round of financing, which closed in August but was not announced until last week.
All of the participants in the seed funding round were individual investors, McAllister says. He declined to share names.
Simplifide intends to sell its software to companies across several industries, including healthcare and banking. McAllister says that high-risk lending is one area where it’s especially important to confirm that prospective borrowers are who they say they are.
The popularity of Venmo and other mobile payment services is surging, and as a result more transactions are taking place every minute. That has led to higher levels of risk in certain parts of the financial sector, McAllister says.
“More ways that money is being moved means more opportunity for hackers,” he says. “These companies need to be able to identify who is moving the money.”
The startup is working to configure its software so that users can verify their customers’ identities using selfie photos they take of their faces on the spot, through voice recognition, or by scanning their fingers or eyes. McAllister says the face-recognizing technology is ready to use today, and that voice is not far behind.
Part of Simplifide’s vision is replacing the palm and iris scanners that some banks, medical clinics, and other brick-and-mortar locations have introduced in recent years. McAllister says that letting people prove their identities using their own Web-enabled devices would yield cost savings for some of the organizations Simplifide is targeting as clients, which wouldn’t have to buy hardware. And with banking in particular, people can now perform more tasks than ever without actually having to walk into a branch, which makes the need for products like Simplifide’s more urgent.
Customers of organizations Simplifide plans to sell to would need to provide Simplifide with pictures of themselves or fingerprint or voice samples. McAllister says the enrollment process would likely involve “white label” branding; in other words, customers providing biometric data would primarily see the logos of their banks or healthcare providers on the screen. However, Simplifide would be the one responsible for managing the data, and keeping it secure, McAllister says.