Fraudsters use sophisticated cons to stealing money and data. Facial verification could be the best weapon we have to defend ourselves.
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Andrew Bud, founder of biometric security software business iProov, tells us why his tech is the front line against fraud and identify theft. Today it is used by governments and global banks to ensure you are who you say you are.
What’s the business in a nutshell?
iProov authenticates online users for logon and ID proofing using biometric face verification. We are world leaders in confirming the genuine presence of the user, whatever device they are using.
In a world where it is now all too easy for criminals to create false identities and fraudulently pose as other people, ‘liveness detection’ and ensuring the supposed user is genuinely who they say they are - and not, for example, just a moving photograph or a synthetic video - is becoming more and more important.
Our technology is used by banks and governments around the world for secure customer onboarding, logon and transaction, thus ensuring new and returning users are genuine and guarding against fraudulent attempts to gain access to personal data or use a stolen identity.
Our team of 25 staff based in London includes cutting-edge developers and world-class university academics, with a leadership team of individuals who have great experience in building and running global-scale internet services.
Why did you start it?
In 2007 I was the Executive Chairman of mBlox Inc., one of the largest processors of SMS mobile payments in the world. Not only did it clear and settle over £300m a year, but it also had low fraud rates, growing revenues and happy mobile operators.
However, in 2008, we ran into serious trouble. Fraudsters in the UK discovered how to fake consumer consents and many consumers lost money.
My feet were held to the fire by the press, which gave me the salutary choice of admitting to either complicity or negligence - not a position I relished, but one I learnt a huge amount from. Subsequently the company was in fact commended by the regulator for its exemplary handling of the incident.
Though extremely unpleasant at the time, this incident taught me just how crucial strong authentication is.
Not only should an identity verification check be simple enough to serve the needs of impatient mobile users, it should also be secure enough to withstand the attention of even the most determined, sophisticated attackers.
There wasn’t anything adequate on the market capable of delivering this, so I just had to invent the solution.
How did the business develop?
Having created the solution required for strong authentication, it quickly became clear that this would help overcome one of the most fundamental challenges of the online ecosystem – the establishment of trust between remote parties.
We received marvellous support from InnovateUK, from whom we have won numerous grants. These helped support the very complex R&D necessary to get to a reliable, secure, saleable product. From there we have worked hard to win referenceable production contracts from very large, demanding customers.
Analysts’ projections estimate the market for online facial verification to be worth approximately £3 billion in the next few years, so there’s a big opportunity for us to make a ground-breaking impact. Since inception we’ve grown very fast, and this year our turnover will be in the several millions.
Tell us about the market conditions
The market is changing very fast. It’s being driven by some big trends – the rapid shift to self-service everything on mobile, new regulations on security, privacy and money-laundering, changes in the way governments keep citizens secure and the rising tide of cyber-aggression.
Organisations have understood that they need to change, and are in search of answers worldwide. Their search leads them to us.
What’s been the biggest challenge?
The biggest challenge for us has been to wait for the market to understand the importance of what we do. Although face verification has been around for a long time, no one has really worried about fakes.
This has meant it’s taken years for buyers to decide that genuine presence actually lies at the heart of biometric security, and that our unique solution – so far superior in usability and security to anything else available – meets their profound need.
Now that we’ve accomplished that, we have some of the smartest people in the world, whether in state secret services or criminal enterprises, against us. To keep our customers safe, it’s therefore even more important to keep our technology advancing and innovating to stay ahead of them.
What has been your biggest mistake?
I made a lot of mistakes building and running previous businesses and have learned from them. High-tech companies can often flourish by over-selling – I don’t consider it a mistake to tell the truth.
What major bumps in the road have you had and how did you overcome them?
Financing a start-up whose revenues come at the far end of a heavy R&D programme has not been at all easy.
First, we were fortunate enough to be a UK company, which has meant that since 2013 we received incredible support from Innovate UK and have won grants of £1.4 million to support our research and development.
Second, this helped us raise substantial equity from private investors, aided by the EIS tax breaks.
Finally, some visionary individuals were crucial, and we were also helped in this respect by matchmaking at the Goldman Sachs Disruptive Technology Symposium.
What sets your business apart from the rest?
From the beginning, our laser focus on solving a single really big, serious problem made us unique.
All our competitors concentrate on providing complete solutions, at the expense of doing well what we do. So, we are the undisputed premium provider worldwide, and our readiness to partner gives us a scale no one else can match. We’ve nurtured our partnerships by making it easy to do business with us.
How did you attract and retain good people?
Really good people need an inspiring problem and a sense of mission, and we certainly have that. They like to work in an open, team-oriented, collaborative environment, which is what we take care to foster.
Very bright people who are nice to each other create a workplace good people want to join. Our Waterloo location is also extremely easy to reach for people all over the South East.
What’s your best advice to others?
This might sound obvious, but first and foremost, decide what you want to do and focus on it - single-mindedly. Don't wonder around poking at other people's businesses. Find a burning problem you can solve and believe in its value.
It’s astonishing how many big problems there are to be solved and how hard large incumbents find it to address them.
The majority of early-stage companies instead begin their pitch by explaining that their disruptive technology will save customers 20 percent of some cost. I’ve learnt from past experience that that kind of thinking leads to failure.
Keep your cash close to your chest until you’ve proved the problem needs solving and that you can solve it, because you don’t know how long it will take, and it always takes longer than you think. It's very hard to use money to make a market move faster.
Once you find that magic formula, focus on large, high profile customers, not start-ups. Though this can make the sales cycle much longer, harder, and even delay revenues, when you win customers of such scale and prominence, they’re far more likely to become game-changers for your business.