Smile Identity, a startup that provides identity verification and KYC compliance for African faces and identities, has raised $20 million in a Series B funding round for further expansion and other roadmap activities. The startup received funding from Silicon Valley investor, Costanoa Ventures, Africa-focused venture capital firm, Norrsken22 with Lexi Novitske, general partner at Norrsken22, who will join the company’s Board. The African KYC onboarding and identity verification startup has now raised more than $30 million from investors since Mark Straub and William Bares launched the startup in 2018.
Other investors that participated in the rounds include; ValueStream Ventures, Intercept Ventures, Latitude, Fut,ure Africa and 500 Fintech — and new backers like Commerce Ventures, Courtside Ventures, and Two Culture Capital.
The startup in a statement noted that the fresh funding round will allow Smile Identity to accelerate the development and adoption of its AI-powered identity verification technology. It will also ramp up hiring efforts in East, Southern, and West Africa, with a focus on product and engineering. The startup plans to expand into new markets across East and South Africa, as well as Francophone and Arab-speaking countries as it banks on its new funding to partner closely with ID authorities and governments to create consumer consent standards and enforce local African data protection laws across the continent.
What you should know about Smile Identity
Smile Identity helps clients mitigate fraud and onboard new customers more efficiently. The company’s recent report, “State of KYC in Africa,” noted that fraud rates on the continent reached an all-time high of 28% last year. The most common attacks, the report says, involve fraudsters providing fake or stolen ID numbers or altered documents such as driver’s licenses, passports, and national IDs. Face mismatches, where facial biometrics do not match valid IDs, are also a common problem. Smile Identity’s combination of different products, including identity verification, digital KYC, user onboarding, liveness checks, face verification, document verification, and anti-fraud checks, helps clients catch this fraud.
The company’s identity data deduplication product is particularly useful in catching fraud. Most of the fraud that Smile Identity notices on behalf of its clients in the payments and money transfer space ensues at the account opening or onboarding stage. The deduplication product guarantees that when end customers sign up to a client’s platform, they are mandated to take a selfie at onboarding against their IDs, making it easiuser’ser to identify the customer better using their faces and reject subsequent new sign-ups in the case of fraud.
Speaking to the firm’s core value proposition, Mark Straub, CEO, and Co-founder, Smile Identity said, “We believe the majority of people are honest, the challenge in the digital age is to prove this, regardless of how a user onboards – whether via agents, apps, tablets, the web, blockchains or paper forms.”
He added that he was thrilled to have the support of investors and partners as the company makes Africa one of the most trusted consumers in the world.
Smile’s Document Verification
Smile Identity’s recent launch of its Document Verification product has allowed the company to expand its capabilities. The product analyzes a document’s photo and compares that to users’ provided selfie. With this product, Smile Identity can now cover a billion identities and verification processes globally, the chief executive said during an interview.
Smile Identity has also expanded on its Business Verification (KYB) solution, which entails 30 detailed business lookups such as registration number, incorporation, directors, beneficiaries, and proprietor status. The product is currently available in Nigeria, Kenya, and South Africa. Smile Identity grew its clientele across all these products by more than 100% over the last year and tripled its revenues within the same time frame.
The recent funding round will help Smile Identity continue to provide much-needed ID verification and KYC compliance services for African faces and identities. As fraud rates continue to rise on the continent, the company’s products will become increasingly important. With its expanded capabilities, Smile Identity can now cover a billion identities and verification processes globally. The company’s dedication to partnering with ID authorities and governments to create consumer consent standards and enforce local African data protection laws across the continent will also be crucial in ensuring that the company’s clients can provide secure and reliable services to their customers.