Footprint, a company unifying KYC (Know Your Customer), security, and authentication to automate consumer onboarding and reduce identity fraud, announced a $13 million Series A led by QED Investors. The funding round included participation from existing investors Index Ventures, Lerer Hippeau, Operator Partners, BoxGroup, Palm Tree Capital, and Definition. New investors Neo and Animal Capital also joined.
This funding round will be used for doubling down on the Footprint product, offering the highest fidelity verification for people today and ways to utilize identities within Footprint tomorrow. And this includes expanding the depth of the Footprint offering.
Footprint will launch its fraud suite and expand the number and types of identification consumers can use to verify, including credit bureau data, pay stubs, and vehicle data. This funding announcement coincides with the launch of Footprint Connections, a tool to connect its customers to each other to leverage the portability created within the platform.
Product and risk teams at companies today face a familiar tradeoff between fraud and friction. In the past, the best way to reduce fraud was to add friction to the onboarding experience, but increased friction may deter some authentic users. By contrast, companies that over-optimized for conversion with lower friction risked higher potential fraud losses over time.
This is due to current point solutions not being able to fundamentally address the root problems. And existing backend KYC tools are unable to actively assess behavioral risk. For example, whether a name or social security number was copied and pasted into a form. And a fraud detection tool may be able to pick up those red flags, but it has no capability to challenge the user by asking for additional documentation to verify their identity.
Footprint combines these tools in one product, utilizing “components” to unify KYC, authentication, and fraud into a single rules engine for account creation and sign-in.
Components are UX elements that can be customized to collect onboarding information, such as a name, date of birth, address, social security number, or document scan. Footprint can dynamically prompt users to collect additional documentation at the time of account creation or when they sign back in. Footprint makes identity portable. This creates an experience like Apple Pay for consumers when they visit a second application that uses Footprint, meaningfully reducing friction for companies and users over time.
Footprint is built with several key pieces of technologies:
1.) Extensible decision and rules engine connected with large identity datasets, enabling customers to create automatic step-ups to improve verification and conversion rates with no-code
2.) Document and selfie verification flow built on native AppClip/InstantApp user experience to create delightful native user experiences and verify the authenticity of the device capturing the document or images
3.) Passkeys meant to bind a biometric to PII to prevent ATOs and phishing
4.) Vaulting infrastructure powered by AWS’s secure computing environment (Nitro Enclaves), ensuring customer data is collected securely and kept private
Footprint was launched in 2022 by Eli Wachs (a Stanford MBA graduate who has been starting companies since high school) and Alex Grinman (studied computer science, math and cryptography at MIT having previously started KryptCo, a mobile auth company that was acquired by Akamai).
Since launching its enterprise platform last fall, Footprint saw impressive growth from its customers spanning financial services, auto and real estate. For example, one customer saw Footprint’s dynamic onboarding tool boost its completion rate by over 50%. And another was able to leverage Footprint to catch an extra 3,000 cases of fraud within the first six months. The company has also signed partnerships in banking, including with both Treasury Prime and Apiture.
KEY QUOTES:
“Core to Footprint is a new philosophy around who fraud and KYC companies should be trying to identify. Companies look to screen out bad actors but there are an infinite amount. In a new age of GenAI, fraudsters have even more tools to mass-create an abundant amount of authentic-seeming identities.”
“We needed a new approach – one that labels good actors – so Footprint created a centralized network of authentic, de-duplicated identities. Now we can narrow the scope of who is in a pre-vetted field, leaving fraudsters less room to hide.”
– Footprint CEO and co-founder Eli Wachs
“The idea of portable identity is not new. But building portable identity really means creating a rules engine that can run on top of secure vaulting and strong authentication. To me, this level of technology was not economically feasible for a startup to build before the release of Nitro Enclaves, which AWS released at the end of 2020. Meanwhile, the FIDO2 alliance agreed on a standard for private and secure auth–what Apple calls passkeys–in Q4 of 2022. This was the final missing piece we saw coming to let us build portable identity.”
– Alex Grinman
“Sharable identities have been the center of financial services discussions on KYC for over a decade, but technological hurdles and business model flaws have prevented previous attempts from getting traction. Footprint leverages the latest industry standards with a business architecture that bakes portable identity into its core, while seamless integration puts business users in the driver’s seat on both fraud and KYC performance. We’ve never seen a company whose value prop resonated so well with both early stage fintechs and late-stage enterprise platforms.”
– QED Investors Partner Amias Gerety
