Monthly Archives: June 2020

Cape Privacy launches data science collaboration platform with $5.06M seed investment

Posted by on 24 June, 2020

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Cape Privacy emerged from stealth today after spending two years building a platform for data scientists to privately share encrypted data. The startup also announced $2.95 million in new funding and $2.11 million in funding it got when the business launched in 2018 for a total of $5.06 million raised.

Boldstart Ventures and Version One led the round with participation from Haystack, Radical Ventures and Faktory Ventures.

Company CEO Ché Wijesinghe says that data science teams often have to deal with data sets that contain sensitive data and share data internally or externally for collaboration purposes. It creates a legal and regulatory data privacy conundrum that Cape Privacy is trying to solve.

“Cape Privacy is a collaboration platform designed to help focus on data privacy for data scientists. So the biggest challenge that people have today from a business perspective is managing privacy policies for machine learning and data science,” Wijesinghe told TechCrunch.

The product breaks down that problem into a couple of key areas. First of all it can take language from lawyers and compliance teams and convert that into code that automatically generates policies about who can see the different types of data in a given data set. What’s more, it has machine learning underpinnings so it also learns about company rules and preferences over time.

It also has a cryptographic privacy component. By wrapping the data with a cryptographic cypher, it lets teams share sensitive data in a safe way without exposing the data to people who shouldn’t be seeing it because of legal or regulatory compliance reasons.

“You can send something to a competitor as an example that’s encrypted, and they’re able  to process that encrypted data without decrypting it, so they can train their model on encrypted data,” company co-founder and CTO Gavin Uhma explained.

The company closed the new round in April, which means they were raising in the middle of a pandemic, but it didn’t hurt that they had built the product already and were ready to go to market, and that Uhma and his co-founders had already built a successful startup, GoInstant that was acquired by Salesforce in 2012. (It’s worth noting that GoInstant debuted at TechCrunch Disrupt in 2011.)

Uhma and his team brought Wijesinghe on board to build the sales and marketing team because as a technical team, they wanted someone with go to market experience running the company, so they could concentrate on building product.

The company has 14 employees and are already an all remote team, so that the team didn’t have to adjust at all when the pandemic hit. While it plans to keep hiring fairly limited for the foreseeable future, the company has had a diversity and inclusion plan from the start.

“You have to be intentional about about seeking diversity, so it’s something that when we sit down and map out our hiring and work with recruiters in terms of our pipeline, we really make sure that that diversity is one of our objectives. You just have it as a goal, as part of your culture, and it’s something that when we see the picture of the team, we want to see diversity,” he said.

Wijesinghe adds, “As a person of color myself, I’m very sensitive to making sure that we have a very diverse team, not just from a color perspective, but a gender perspective as well,” he said.

The company is gearing up to sell the product  and has paid pilots starting in the coming weeks.

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Ampere announces latest chip with a 128 core processor

Posted by on 23 June, 2020

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In the chip game, more is usually better and to that end, Ampere announced the next chip on its product roadmap today, the Altra Max, a 128 core processor, the company says is designed specifically to handle cloud native, containerized workloads.

What’s more, the company has designed the chip, so that it will fit in the same slot as their 80 core product announced last year (and in production now). That means that engineers can use the same slot when designing for the new chip, which saves engineering time and eases production, says Jeff Wittich, vp of products at the company,

Wittich says that his company is working with manufacturers today to make sure they can build for all of the requirements for the more powerful chip. “The reason we’re talking about it now, versus waiting until Q4 when we’ve got samples going out the door is because it’s socket compatible, so the same platforms that the Altra 80 core go into, this 128 core product can go into,” he said.

He says that containerized workloads, video encoding, large scale out databases and machine learning inference will all benefit from having these additional cores.

While he wouldn’t comment on any additional funding, the company has raised $40 million, according to Crunchbase data, and Wittich says they have enough funding to to into high-volume production later this year on their existing products.

Like everyone, the company has faced challenges keeping a consistent supply chain throughout the pandemic, but when it started to hit in Asia at the beginning of this year, the company set a plan in motion to find backup suppliers for the parts they would need should they run into pandemic-related shortages. He says that it took a lot of work, planning and coordination, but they feel confident at this point in being able to deliver their products in spite of the uncertainty that exists.

“Back in January we actually already went through [our list of suppliers], and we diversified our supply chain and made sure that we had options for everything. So we were able to get in front of that before it ever became a problem,” he said.

“We’ve had normal kinds of hiccups here and there that everyone’s had in the supply chain, where things get stuck in shipping and they end up a little bit late, but we’re right on schedule with where we were.”

The company is already planning ahead for its 2022 release, which is already in development.
“We’ve got a test chip running through five nanometer right now that has the key IP and some of the key features of that product, so that we can start testing those out in silicon pretty soon,” he said.

Finally, the company announced that it’s working with some new partners including Cloudflare, Packet (which was acquired by Equinix in January) Scaleway and Phoenics Electronics, a division of Avnet. These partnerships provide another way for Ampere to expand its market as it continues to develop.

The company was founded in 2017 by former Intel president Renee James.

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Salesforce introduces several new developer tools including serverless functions

Posted by on 23 June, 2020

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Salesforce has a bunch of announcements coming out of the virtual Trailheadx conference taking place later this week, starting today with some new developer tools. The goal of these tools is to give developers a more modern way of creating applications on top of the Salesforce platform.

Perhaps the most interesting of the three being announced today is Salesforce Functions, which enable developers to build serverless applications on top of Salesforce. With a serverless approach, the developer creates a series of functions that trigger an operation. The cloud provider then delivers the exact amount of infrastructure resources required to run that operation and nothing more.

Wade Wegner, VP of product for Salesforce and Salesforce DX, says the Salesforce offering gives developers a lot of flexibility around development languages such as Node.js or Java, and cloud platforms such as AWS or Azure. “I can just write my code, deploy it and let Salesforce operate it for me,” he said.

Wegner explained that the new approach lets developers build serverless applications with data that lives in Salesforce, and then run it on elastic infrastructure. This gives them the benefits of vertical and horizontal scale without having to be responsible for managing all aspects of how their application will run on the cloud infrastructure.

In addition to Functions, the company is also announcing Code Builder, a web-based IDE based on Microsoft Visual Studio Code Spaces. “By leveraging Visual Studio Code Spaces we can bring the same capabilities to developers right in the browser, ” Wegner said.

He adds that this enables them to be more productive with support for many languages and frameworks in a browser in the context of the environment that they’re doing their work, while giving them a consistent and familiar experience.

Finally, the company is announcing the DevOps Center, which is a place to manage the growing complexity of delivering applications built on top of Salesforce in a modern continuous way. “It is really meant to provide new ways with which teams of developers can collaborate around the work that they’re doing, and to manage the complexities of continuously delivering applications…,” he said.

As is typical for Salesforce, the company is announcing these tools today, but they will not be generally available for some time. Functions and Code Builders are both in pilot, while DevOps Center will be available as a developer preview later this year.

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Hasura launches managed cloud service for its open-source GraphQL API platform

Posted by on 22 June, 2020

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Hasura is an open-source engine that can connect to PostgreSQL databases and microservices across hybrid- and multi-cloud environments and then automatically build a GraphQL API backend for them, making it easier for developers to then build their own data-driven applications on top of this unified API . For a while now, the San Francisco-based startup has offered a paid version (Hasura Pro) with enterprise-ready reliability and security tools, in addition to its free open-source version. Today, the company launched Hasura Cloud, which takes the existing Pro version, adds a number of cloud-specific features like dynamic caching, auto-scaling and consumption-based pricing, and brings those together in a fully managed service.

Image Credits: Hasura

At its core, Hasura’s service promises businesses the ability to bring together data from their various siloed databases and allow their developers to extract value from them through its GraphQL APIs. While GraphQL is still relatively new, the Facebook-incubated technology has quickly become extremely popular among many development teams.

Before founding the company and launching it in 2018, Hasura CEO and co-founder Tanmai Gopal worked for a consulting firm — and like with so many founders, that’s where he got the inspiration for the service.

“One of the key things that we noticed was that in the entire landscape, computing is becoming better, there are better frameworks, it is easier to deploy code, databases are becoming better and they kind of work everywhere,” he said. “But this kind of piece in the middle that is still a bottleneck and that there isn’t really a good solution for is this data access piece.” Almost by default, most companies host data in various SaaS services and databases — and now they were trying to figure out how to develop apps based on this for both internal and external consumers, noted Gopal. “This data distribution problem was this bottleneck where everybody would just spend massive amounts of time and money. And we invented a way of kind of automating that,” he explained.

The choice of GraphQL was also pretty straightforward, especially because GraphQL services are an easy way for developers to consume data (even though, as Gopal noted, it’s not always fun to build the GraphQL service itself). One thing that’s unusual and worth noting about the core Hasura engine itself is that it is written in Haskell, which is a rather unusual choice.

Image Credits: Hasura

The team tells me that Hasura is now nearing 50 million downloads for its free version and the company is seeing large and small users from across various industries relying on its products, which is probably no surprise, given that the company is trying to solve a pretty universal problem around data access and consumption.

Over the last few quarters, the team worked on launching its cloud service. “We’ve been thinking of the cloud in a very different way,” Gopal said. “It’s not your usual, take the open-source solution and host it, like a MongoDB Atlas or Confluent. What we’ve done is we’ve said, we’re going to re-engineer the open-source solution to be entirely multi-tenant and be completely pay-per pricing.”

Given this philosophy, it’s no surprise that Hasura’s pricing is purely based on how much data a user moves through the service. “It’s much closer to our value proposition,” Hasura co-founder and COO Rajoshi Ghosh said. “The value proposition is about data access. The big part of it is the fact that you’re getting this data from your databases. But the very interesting part is that this data can actually come from anywhere. This data could be in your third-party services, part of your data could be living in Stripe and it could be living in Salesforce, and it could be living in other services. […] We’re the data access infrastructure in that sense. And this pricing also — from a mental model perspective — makes it much clearer that that’s the value that we’re adding.”

Now, there are obviously plenty of other data-centric API services on the market, but Gopal argues that Hasura has an advantage because of its advanced caching for dynamic data, for example.

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4 enterprise developer trends that will shape 2021

Posted by on 22 June, 2020

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Technology has dramatically changed over the last decade, and so has how we build and deliver enterprise software.

Ten years ago, “modern computing” was to rely on teams of network admins managing data centers, running one application per server, deploying monolithic services, through waterfall, manual releases managed by QA and release managers.

Today, we have multi and hybrid clouds, serverless services, in continuous integration, running infrastructure-as-code.

SaaS has grown from a nascent 2% of the $450B enterprise software market in 2009, to 23% in 2020 and crossed $100B in revenue. PaaS and IaaS revenue represent another $50B in revenue, expecting to double to $100B by 2022.

With 77% of the enterprise software market — over $350B in annual revenue — still on legacy and on-premise systems, modern SaaS, PaaS and IaaS eating at the legacy market alone can grow the market 3x-4x over the next decade.

As the shift to cloud accelerates across the platform and infrastructure layers, here are four trends starting to emerge that will change how we develop and deliver enterprise software for the next decade.

1. The move to “everything as code”

Companies are building more dynamic, multiplatform, complex infrastructures than ever. We see the “-aaS” of the application, data, runtime and virtualization layers. Modern architectures are forcing extensibility to work with any number of mixed and matched services.

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Canva raises $60 million on a $6 billion valuation

Posted by on 22 June, 2020

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Sydney-based Canva, the design platform for non-designers, has today announced the close of a $60 million funding round, bringing its valuation to $6 billion, according to the company.

The startup has raised a total of more than $300 million, including this latest round of financing, from investors like Bond, General Catalyst, Sequoia Capital China, Felicis Ventures, and Blackbird Ventures .

Canva COO and cofounder Cliff Obrecht explained that the round was 10x oversubscribed with interest from angels and new VCs, but that the company resisted taking extra capital.

“At our stage, investors are looking to deploy $50 million+ in capital,” said Obrecht. “Even our existing investors were looking to deploy between $50 million and $100 million, but we said ‘Oh, gee, we really don’t want to be diluted that much because we have a lot of conviction in the business and we don’t need that much money’.”

He also said that the company wanted to remain with existing investors — Blackbird and Sequoia Capital China led this round — because those investors bet on the company when it was in its infancy, founded by three people in an isolated part of the world with no technical chops.

At the beginning of the pandemic, Canva made a commitment to continue paying all of its contracted workers, but froze hiring. The company also made quick moves to shut down the office and move to remote work. However, Canva is one of the few companies that is getting a boost from the world moving to work from home.

The company has seen a 50 percent uptick in shared designs, and around a 25 percent increase in designs created each month. Overall, Canva is growing 100 percent year over year in both revenue and users, with 30 million monthly active users across 190 countries.

Canva was founded in 2012 with the mission of democratizing design tools. While many non-designers can navigate their way around Google Slides or Powerpoint, or maybe even crop an image, going more in-depth on a design project can be daunting, as the suite of tools provided to designers can be incredibly complex.

The company’s tools are meant to simplify the design process for folks who don’t work in the design department, whether it’s the sales team putting together sales materials, marketers working on content, or other departments working on internal materials to send to the broader organization. The drag-and-drop interface gives folks a way to create something beautiful and impressive without having to learn PhotoShop.

The product started out as a freemium product for individual consumers but eventually started offering enterprise products, as well as a video editing tool that comes complete with video templates, easy-to-use animation tools, and a library of stock video, music, etc.

The company has also launched an educational platform called Canva for Education, which integrates with GSuite and Google Classroom to get students started on design early. Canva also offers a developer platform for startups that want to integrate with the company, which currently includes Dropbox, Google Drive, PhotoMosh and Instagram, among others.

Most recently, Canva partnered with FedEx Office to offer easy design-to-print products that let users pick up print designs from one of more than 2,000 locations in the U.S. as the Sydney-based companies looks to secure a foothold in this market.

Canva plans on using the funding to grow the company, make a push into collaboration, and to continue making acquisitions.

On the heels of the funding, Canva is looking to hire — the company currently has 1,000+ employees, 40+ percent of which are female. (Canva did not disclose the percentage of its workforce that are non-white.)

Obrecht says that one of the greatest challenges for the company and for leadership personally is the burden of not feeling like they’re doing enough to make the world a better place. He explained that the company has a number of initiatives focused on this core tenet, including free access to the platform for over 50,000 non-profit organizations, education initiatives, anti-discrimination policies within its TOS, and more.

“But it just never really feels like enough,” said Obrecht. “You see what’s happening and it’s a bit of a shit show and it’s not aspirational at all. It doesn’t look like it’s getting fixed quickly by the adults who are in government. They’re not doing the right thing, and if they’re not, who will? So we really believe we should have a heavy part in trying our best to make sure the shit show doesn’t continue.”

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ServiceNow to acquire Belgian configuration management startup Sweagle

Posted by on 22 June, 2020

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With more companies moving workers home, making sure your systems are up and running has become more important than ever. ServiceNow, which includes an IT Help Desk component in its product catalogue recognizes that help desks have been bombarded during the pandemic. To help stop configuration problems before they start, the company acquired Sweagle today, a  configuration management startup based in Belgium.

The companies did not share the purchase price.

ServiceNow gets a couple of boosts in the deal. First of all, it gets the startup’s configuration management products, which it can incorporate into its own catalogue, but it also gains the machine learning and DevOps knowledge of the company’s employees. (The company would not share the exact number of employees, but Pitchbook pegs it at 15.)

RJ Jainendra, ServiceNow’s vice president and general manager of DevOps and IT Business Management, sees a company that has pioneered the IT configuration management automation space, and brings with it capabilities that can boost ServiceNow’s offerings. “With capabilities for configuration data management from Sweagle, we will empower DevOps teams to deliver application and infrastructure changes more rapidly while reducing risk,” Jainendra said in a statement.

ServiceNow claims that there can be as many as 50,000 different configuration elements in a single enterprise application. Sweagle has designed a configuration data management platform with machine learning underpinnings to help customers simplify and automate that complexity. Configuration errors can cause shutdowns, security issues and other serious problems for companies.

Sweagle was founded in 2017 and raised $4.05 million on a post valuation of $11.88 million, according to Pitchbook data.

The company is part of a growing pattern of early stage startups being sucked up by larger companies during the pandemic including VMware acquiring Ocatarine and Atlassian buying Halp in May and NetApp snagging Spot earlier this month..

This is the third acquisition for ServiceNow this year, all involving AI underpinnings. In January it bought Loom Systems and Passsage AI. The deal is expected to close in Q3 this year, according to ServiceNow.

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HashiCorp to offer managed versions of its developer tools starting with Consul

Posted by on 22 June, 2020

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HashiCorp is well known in the developer community for offering a slew of open source tools to help build and manage modern applications. Today the company announced a new cloud platform and plans to eventually offer managed versions of those tools, starting with Consul a tool for connecting and securing services across platforms.

HashiCorp CEO Dave McJannet says that the pandemic has accelerated demand for cloud infrastructure, and he sees a growing role for his company in helping to build cloud native applications. The company offers open source and commercial versions of several popular tools including Terraform, Consul, Vault and Packer among others. These can run on premises or in the cloud, but McJannet says customers have been hankering for SaaS versions of these tools.

“Our customers have told us that it’s a huge challenge running a central shared service like Consul. It requires them to keep it up and running, and they have asked for something they can consume from us where we manage it for them,” McJannet told TechCrunch.

The company has been offering a managed version of Terraform for some time, but it has been quietly working on a cloud platform that could allow it to plug in each of the company’s products over time and offer managed services of all the products.

“What we are announcing today is what we call the HashiCorp Cloud Platform, and you can think of it as just a common chassis to allow us to run our products on any cloud. The first of those products that we’re making available is Consul on Amazon,” he said.

By offering the company’s products as a set of cloud services, it will lower the barrier to entry for customers who want to use their tooling, but don’t have the resources to run and manage on their own. That could potentially increase the company revenue over time. As McJannet pointed out it’s a lot like what MongDB did with its managed Atlas database service, but for a wider set of products.

Last Fall, HashiCorp announced a $175 million investment on an impressive $5 billion valuation. It has 1000 employees and is continuing to hire as demand for its product continues through the pandemic. McJannet was not discussing specific customer numbers, but said the customer count has doubled over the last year. As it builds out the new cloud services, and introduces more customers to its products, there’s a good chance that number will keep growing.

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Intercom announces the promotion of Karen Peacock to CEO

Posted by on 18 June, 2020

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Three years ago almost to the day, Intercom announced that it was bringing former Intuit exec Karen Peacock on board as COO. Today, she got promoted to CEO, effective July 1st. Current CEO and company co-founder Eoghan McCabe will become Chairman.

As it turns out, these moves aren’t a coincidence. McCabe had been actively thinking about a succession plan when he hired Peacock. “When I first started talking to Eoghan three years ago, he shared with me that his vision was to hire someone as COO, who could then become the CEO at the right time and he could transition into the chairman role,” Peacock told TechCrunch.

She said while the idea was always there, they didn’t feel the need to rush the process. “We were just looking for whatever the right time was, and it wasn’t something we were expected to do in the first year or two. And now is really the right time to transition with all of the momentum that we’re seeing in the market,” she said.

She said as McCabe makes the transition away from running the company he helped found, he will still be around, and they will continue working together on things like product and marketing strategy, but Peacock brings a pedigree of her own to the new role.

Not only has she been in charge of commercial aspects of the Intercom business for the past three years, prior to that she was SVP at Intuit where she ran small business products that included QuickBooks, and grew it from a $500 million business to a hefty $2.5 billion during her tenure.

McCabe says that experience was one of the reasons he spent six months trying to convince Peacock to become COO at Intercom in 2017. “It’s really hard to find a leader that’s as well rounded, and as unique as Karen is. You know she doesn’t actually fit your typical very experienced operator,” he said. He points to her deep product background, calling her a “product nerd,” and her undergraduate degree in applied mathematics from Harvard as examples.

In spite of the pandemic, she’s taking over a company that’s still managing to grow. The company’s business messenger products, which enable companies to chat with customers online have become increasingly important during the pandemic with many brick and mortar businesses shut down and the majority of business is being conducted digitally.

“Our overall revenue is $150 million in annual recurring revenue, and a supporting data point to what we were just talking about is that our new business to up market customers through our sales teams has doubled year over year. So we’re really seeing some quite nice acceleration there,” she said.

Peacock says she wants to continue building the company and using her role to build a diverse and inclusive culture. “I believe that [diversity and inclusion] is not one person’s job, it’s all of our jobs, but we have one person who’s the center post of that (a head of D&I). And then we work with outside consulting firms as well to just try and stay in a place where we understand all of what’s possible and what we can do in the world.”

She adds, “I will say that we need to make more progress on diversity and inclusion, I wouldn’t step back and, and pat ourselves on the back and say we’ve done this perfectly. There’s a lot more that we need to do, and it’s one of the things that I’m very excited to tackle as CEO.”

According to a February Wall Street Journal article, less than 6% of women hold CEO jobs in the U.S. Peacock certainly sees this and wants to continue to mentor women as she takes over at Intercom. “It is something that I’m very passionate about. I do speak to various different groups of up and coming women leaders, and I mentor a group of women outside of Intercom,” she said. She also sits on the board at Dropbox with other women leaders like Condoleezza Rice and Meg Whitman.

Peacock says that taking over during a pandemic makes it interesting, and instead of visiting the company’s offices, she’ll be doing a lot of video conferences. But neither is she coming in cold to the company having to ramp up on the business side of things, while getting to know everyone.

“I feel very fortunate to have been with Intercom for three years, and so I know all the people and they all know me. And so I think it’s a lot easier to do that virtually than if you’re meeting people for the very first time. Similarly, I also know the business very well, and so it’s not like I’m trying to both ramp up on the business and deal with a pandemic,” she said.

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Payfone raises $100M for its mobile phone-based digital verification and ID platform

Posted by on 18 June, 2020

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As an increasing number of daily and essential services move to digital platforms — a trend that’s had a massive fillip in the last few months — having efficient but effective ways to verify that people are who they say they are online is becoming ever more important. Now, a startup called Payfone, which has built a B2B2C platform to identify and verify people using data (but no personal data) gleaned from your mobile phone, has raised $100 million to expand its business. Specifically, Rodger Desai, the co-founder and CEO, said in an interview that plan will be to build in more machine learning into its algorithms, expand to 35 more geographies, and to make strategic acquisitions to expand its technology stack.

The funding is being led by Apax Digital, with participation from an interesting list of new and existing backers. They include Sandbox Insurtech Ventures, a division of Sandbox Industries, which connects corporate investment funds with strategic startups in their space); Ralph de la Vega, the former Vice Chairman of AT&T; MassMutual Ventures; Synchrony; Blue Venture Fund (another Sandbox outfit); Wellington Management LLP; and the former CEO of LexisNexis, Andrew Prozes.

Several of these investors have a close link to the startup’s business: Payfone counts carriers, healthcare and insurance companies, and banks among its customers, who use Payfone technology in their backends to help verify users making transactions and logging in to their systems.

Payfone tells me it has now raised $175 million to date, and while it’s not disclosing its valuation with this round, according to PitchBook, in April 2019 when it raised previously it was valued at $270 million. Desai added that Payfone is already profitable and business has been strong lately.

“In 2019 we processed 20 billion authentications, mostly for banks but also healthcare companies and others, and more generally, we’ve been growing 70% year-over-year,” he said. The aim is to boost that up to 100 billion authentications in the coming years, he said.

Payfone was founded in 2008 amongst a throng of mobile payment startups (hence its name) that emerged to help connect consumers, mobile content businesses and mobile carriers with simpler ways to pay using a phone, with a particular emphasis on using carrier billing infrastructure as a way of letting users pay without inputting or using cards (especially interesting in regions where credit and debit card penetration and usage are lower).

That has been an interesting if slowly growing business so around 2015 Payfone starting to move towards using its tech and infrastructure to delve into the adjacent and related space of applying its algorithms, which use authentication data from mobile phones and networks, to help carriers, banks, and many other kinds of businesses verify users on their networks.

(Indeed, the connection between the technology used for mobile payments that bypasses credit/debit cards and the technology that might be used for ID verification is one that others are pursuing, too: Carrier billing startup Boku — which yesterday acquired one of its competitors, Fortumo, in a $41 million deal as part of a wider consolidation play — also acquired one of Payfone’s competitors, Danal, 18 months ago to add user authentication into its own range of services.)

The market for authentication and verification services was estimated to be worth some $6 billion in 2019 and is projected to grow to $12.8 billion by 2024, according to research published by MarketsandMarkets. But within that there seems to be an almost infinite amount of variations, approaches, and companies offering services to carry out the work. That includes authentication apps, password managers, special hardware that generates codes, new innovations in biometrics using fingerprints and eye scans, and more.

While some of these require active participation from consumers (say by punching in passwords or authentication codes or using fingerprints), there’s also a push to develop more seamless and user-friendly, and essentially invisible, approaches, and that’s where Payfone sits.

As Desai describes it, Payfone’s behind-the-scenes solution is used either as a complement to other authentication techniques and on its own, depending on the implementation. In short, it’s based around creating “signal scores” and tokens, and is built on the concept of “data privacy and zero data knowledge architecture.” That is to say, the company’s techniques do not store any personal data and do not need personal data to provide verification information.

As he describes it, while many people might only be in their 20s when getting their first bank account (one of the common use cases for Payfone is in helping authenticate users who are signing up for accounts via mobile), they will have likely already owned a phone, likely with the same phone number, for a decade before that.

“A phone is with you and in your use for daily activities, so from that we can opine information,” he said, which the company in turn uses to create a “trust score” to identify that you are who you say you are. This involves using, for example, a bank’s data and what Desai calls “telecoms signals” against that to create anonymous tokens to determine that the person who is trying to access, say, a bank account is the same person identified with the phone being used. This, he said, has been built to be “spoof proof” so that even if someone hijacks a SIM it can’t be used to work around the technology.

While this is all proprietary to Payfone today, Desai said the company has been in conversation with other companies in the ecosystem with the aim of establishing a consortium that could compete with the likes of credit bureaus in providing data on users in a secure way.

“The trust score is based on our own proprietary signals but we envision making it more like a clearing house,” he said.

The fact that Payfone essentially works in the background has been just as much of a help as a hindrance for some observers. For example, there have been questions raised previously about how data is sourced and used by Payfone and others like it for identification purposes. Specifically, it seems that those looking closer at the data that these companies amass have taken issue not necessarily with Payfone and others like it, but with the businesses using the verification platforms, and whether they have been transparent enough about what is going on.

Payfone does provide an explanation of how it works with secure APIs to carry out its services (and that its customers are not consumers but the companies engaging Payfone’s services to work with consumer customers), and offers a route to opt out of of its services for those that seek to go that extra mile to do so, but my guess that this might not be the end of that story if people continue to learn more about personal data, and how and where it gets used online.

In the meantime, or perhaps alongside however that plays out, there will continue to be interesting opportunities for approaches to verify users on digital platforms that respect their personal data and general right to control how any identifying detail — personal or not — gets used. Payfone’s traction so far in that area has helped it stand out to investors.

“Identity is the key enabling technology for the next generation of digital businesses,” said Daniel O’Keefe, managing partner of Apax Digital, in a statement. “Payfone’s Trust Score is core to the real-time decisioning that enterprises need in order to drive revenue while thwarting fraud and protecting privacy.” O’Keefe and his colleague, Zach Fuchs, a principal at Apax Digital, are both joining the board.

“Payfone’s technology enables frictionless customer experience, while curbing the mounting operating expense caused by manual review,” said Fuchs. 

Posted Under: Tech News
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