VITAL STATISTICS
- Company: iProov
- What it does, in a sentence: We secure people’s online identities, by assuring their genuine presence when they use face verification to onboard and check back in.
- Founded: 2011
- Founder/s: Andrew Bud
- Size of team: 45+
- Your name and role: Andrew Bud, Founder and CEO
What problem are you trying to solve?
iProov specialises in secure facial biometric verification for ID verification and cyber access. The problem we solve is determining whether the face you see is genuinely present, or whether it is some sort of physical or digital copy, and doing so very usably. Once this problem is solved for people aged 9 to 90, it enables a wide range of organisations to offer simple-to-use face verification to their customers, secure that they are protected against the very real cyber threats from fraudsters tricking or ‘spoofing’ their systems.
We solved this problem through our unique, patented technology – Flashmark. It uses the device screen to illuminate the user to create a ‘one-time biometric’, which is only valid at the very moment it’s being streamed. We use a different sequence of colours that illuminate the user’s face each time an individual is attempting to verify themselves. This means that fraudsters can’t play back videos of genuine users to fool the verification technology, as each one is created uniquely for each interaction. And it works on any device.
How big is the market – and how much of it do you think you can own?
According to Goode Intelligence research, the digital identity and document verification market is set to be worth $15 billion by 2024. Undoubtedly, it’s a market that is changing incredibly fast.
It’s also being driven by some big trends – the rapid shift to self-servicing on mobile, new regulations on security, privacy, money laundering, changes in the way governments keep citizens secure, and the rising tide of cyber-aggression.
Organisations worldwide have understood that they need to change and are in search of answers. This search leads them to us.
How do you make money?
Our revenues are the recurring fees typical of a SaaS business – monthly service fees plus volume-related charges. It makes our business stable and creates an engine for extremely fast growth. Most of our revenue comes from several different territories, giving us added stability in periods of economic uncertainty.
Who’s on your team that makes you think you can do this?
We’ve built a world-class team at iProov with a diverse range of cutting-edge developers and world-class university academics, and we have a hugely experienced leadership team who’ve been involved in building and running global-scale internet services for many years.
Who’s bankrolling you?
As a UK company, we’ve been fortunate that since 2013 we’ve received incredible support from InnovateUK and have won grants of £1.8 million to support our research and development. This in turn has helped us raise substantial equity from private investors, aided by EIS tax breaks.
What advice would you give other entrepreneurs trying to secure that kind of finance?
Find the problem you need to solve and remain utterly focused on solving it. The majority of early-stage companies begin their pitch by explaining that their disruptive technology solve world hunger, and will also save customers 20 percent of some cost. I’ve learnt from past experience that that kind of thinking leads straight to failure.
Big innovations only win if they solve problems for customers, so focus on finding and solving them. Then, harbour your cash until you’ve done so, because you don’t know how long it will take. The process always takes longer than you think.
What do you believe the key to growing this business is?
We’ve been guided by three key principles.
First, focus on what we excel at – creating the most secure online face verification possible. It’s terribly easy to be distracted in the early start-up years by neighbouring needs and problems, and to be led into trying to develop much broader solutions. We stripped everything back, decided what not to do, and when to partner rather than build. Even now partnerships remain foundational to our strategy.
Second, discover the market, don’t assume it. It’s the customers who tell you what they want to use an innovation for, and you must spread yourself thinly until you find that out. Premature marketing focus could be fatal. This is how we became leaders in onboarding.
Finally, we focused on large, high profile customers, rather than start-ups. We knew this would make the sales cycle much longer, harder and delay revenues. But we also knew that once we won such customers, our approach would truly pay off, as it has, completely transforming the business. Today our reputation is built on customers like the U.S. Department of Homeland Security, the UK Home Office, the Dutch bank ING and a major government customer in the Far East.
What metrics do you look at every day?
We care about the metrics that tell us how good a job we are doing for our customers, and how that is helping them to succeed and us to grow. Activity measurements, coupled with performance metrics are vital to us. Recognised revenue is what pays our salaries. Growth rates nourish our ambition. And we are a real business, so we pay close attention to EBITDA and cashflow!
What’s been the most unexpectedly valuable lesson you’ve learnt so far?
Thankfully, I have to say that doing something your team loves is perhaps the most important and valuable lesson I’ve learnt. Big ideas get everyone out of bed in the morning, even when the going gets tough.
I’ve learned that smart people migrate to where the action is. I spent nearly three decades innovating in the mobile communications industry, changing the way people communicate. Now, online trust is an even more exciting challenge for the future of our society, and I’m increasingly finding many of the same people making a contribution here. That has a range of positive consequences.
What’s been your biggest mistake so far?
We allowed ourselves to believe in the mythology about MVPs (Minimum Viable Products) and tried to commercialise too early, albeit on a small, controlled scale. We took an early version of our product to a major bank in 2014, and saw its flaws and weaknesses exposed. We wasted time and effort on discovering that our MV was not the same as our customers’! It taught us to put our heads down and keep our mouths shut until we had something that was truly great.
What do you think is on the horizon for your industry in the year ahead?
With extensive changes in banking legislation looming, I think we can expect the application of face verification technology to become even more widespread.
In September 2019, all banks across Europe should have complied with the strong customer authentication regulations implemented in line with the latest payment services directive. This has now been delayed by a further year or two, and will have to be applied during high-risk transactions, including use-cases such as paying individuals large sums of money or sending personal details.
Recently, on top of the governments, financial institutions and large-scale enterprises we count amongst our customers, we’ve also received interest from a wide range of other sectors, including the healthcare industry, the access control and automotive industries. What’s more, there’s been interest from Chief Information Security Officers at large enterprises, who are exploring how to integrate facial verification technology into sensitive systems accessed by employees or business partners.
How would a no-deal Brexit affect your business or others within your industry?
As contributors to the UK Government’s EU Settled Status app, we can’t really comment. However we are looking at the consequences to GDPR compliance of the failure to secure an Adequacy ruling under any no-deal or deal scenario.
Which London start-up/s are you watching, and why?
We have been privileged to participate in a number of scale-up activities this year, including Technation Cyber and the Mayor’s International Business programme, and have been hugely impressed by our peers in these cohorts.
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