LONDON — A “RegTech” — regulation technology — company founded by three Oxford grads all under 30 has raised $30 million (£22.4 million) from investors including Microsoft’s venture capital arm.
Onfido, an identity verification startup, has raised the “Series C” fundraising from Crane Venture Partners, Microsoft Ventures, TempoCap and Salesforce Ventures, as well as existing investors. It takes the total raised by the London startup to over $60 million.
Onfido was founded in 2012 but only began proper operations around 2 years ago. It uses machine learning technology to help companies like Deliveroo, Zipcar, and Square verify the identity of customers and clients by checking that documents like passports and drivers licences are real.
The company Onfido was set up by three Oxford graduates with an average age of 27. CEO and cofounder Husayn Kassai, 27, told Business Insider: “In many ways, it’s somewhat surreal. We started out as a small startup, starting from zero five years ago having not done this before and just out of university. It’s beyond anything we could have dreamed of.”
From wild animals to passports
Kassai set up Onfido with Eamon Jubbawy, 25, and Ruhul Amin, 29. The idea for the company was originally based on Amin’s university thesis.
“Ruhul, his university thesis was using computer vision and machine learning to spot wildlife in a series of 25,000 photos of the jungle,” Kassai says. That led to brainstorming about what else the technology could be used for.
“An important part of identity verification, a key component will be a document check. That is all about pattern recognition. Given that smartphones are used, documents can be held at an angle — all these kinds of things — that’s where our applications are particularly strong,” Kassai says.
Onfido began trying to apply Amin’s technology to document checking in 2012 but there was a lot of hard graft to get the company off the ground.
“As with any technology, you need a lot of data to help it get stronger,” Kassai explains. “It was almost three years ago that the data set that we had was significantly large to make our technology perform better than the human eye or other providers. What’s happened since is that with everything single pattern check it gets stronger and better.”
Today, Onfido employs a team of 10 machine learning engineers, all with PhDs. “Machine learning” has become a buzzword in tech this year but Kassai is quick to add: “They’re real practitioners.”
Onfido provides document checks for around 1,500 companies, most in the financial services sector, the sharing economy, or the gig economy. (The company, which is approved by the Home Office, ran identity checks for Uber drivers until Transport for London recently mandated that all private hire companies use the same identity checker.)
‘It’s a continuous learning curve’
Kassai and his cofounders may have a handle on the technology, how do they manage the job of running a fast-growing company at such a young age?
“There are many cases, usually where it’s our first time doing something,” Kassai admits. “It’s a continuous learning curve.”
But he adds: “An advantage of being young is we rely on each other as cofounders all the time and continuously consult and share ideas. And we are heavily reliant on advisors and senior team leaders and others who have done it before. We have to be resourceful and we have fortunately been able to do so.”
Sometimes their youth can also play to their advantage in hiring, he says.
“When you’re trying to recruit people and sitting across the table from some of the best people in the world, it helps if you’re upfront with them and say, ‘We can’t hide the fact that we’re young, however, if you join us you’d be valued and you’d be empowered to deliver, because we don’t know how to do it any other way.’ That, I think, turns it into an advantage.”
Onfido targets Latin America
Onfido’s latest $30 million funding injection follows a $25 million investment last April. Kassai says the latest funding will go towards technology investment and global expansion.
“We are a team of about 150 and half the team, roughly, is on the technology side. We’re solving a very complex problem so obviously, we need a lot of investment in that.”
He adds: “The other part of it will be investing in global expansion. Our core markets are the US, UK, and India. We’re going to be investing even more in the US because it’s our largest and fastest growing market. But equally Latin America. Particularly with fintechs, we’re getting more and more clients [there] so we want to be putting more resources to expand on a global scale too.”
Kassai said he couldn’t comment on Onfido’s valuation in the latest fundraising.Tags: Fundraising, Onfido, RegTech