The Expanding Landscape of Identity Verification

Demand within the identity verification sector has been steadily increasing, a trend significantly accelerated by the rise in online transactions during the COVID-19 pandemic.

Persona Secures $50 Million in Series B Funding

Persona, a startup concentrating on delivering a customized identity verification experience applicable to diverse scenarios, is aiming to establish a distinct position within this competitive market. Investors have demonstrated confidence in the San Francisco-based company’s capacity to assist businesses in tailoring the identity verification process – and extending beyond it – through its no-code platform, evidenced by a recently secured $50 million Series B funding round.

Index Ventures spearheaded the financing, with additional participation from existing investor Coatue Management. Previously, in January 2020, Persona successfully raised $17.5 million during a Series A funding round. The company has chosen not to disclose the valuation associated with this latest investment.

Platform Capabilities and Functionality

Organizations can integrate with Persona’s platform via an API, enabling the utilization of various verification methods. These include government-issued identification documents and biometrics, to confirm customer identities.

The company is focused on simplifying the implementation of robust verification procedures, leveraging third-party documentation, real-time assessments like live selfie authentication, and artificial intelligence to validate users.

Persona’s system also gathers passive data points, such as a user’s device information, location, and behavioral patterns, to create a comprehensive risk assessment. Both low-code and no-code options are available, catering to varying customer requirements.

Significant Growth and Momentum

The startup’s growth trajectory is demonstrably strong. According to co-founder and CEO Rick Song, revenue has increased by “more than 10 times” and the customer base has expanded fivefold over the past year, although specific revenue figures were not provided. Concurrently, Persona’s workforce has more than tripled, now exceeding 50 employees.

“Looking back at the industry five to ten years ago, AI was the primary differentiator, and now every identity verification company is employing AI and machine learning,” Song explained to TechCrunch. “We believe the next significant differentiator lies in tailoring and personalizing the experience for each individual.”

Focus on Customization and SaaS Solutions

Song posits that future growth will be directly linked to Persona’s ability to support companies with “unique” use cases through a Software-as-a-Service (SaaS) platform that minimizes the need for extensive engineering resources. The ultimate objective is to assist businesses in preventing fraud, ensuring compliance, and fostering trust and safety, while simultaneously enabling them to customize the verification process to their specific needs.

Persona’s customer base spans numerous industries and includes prominent companies such as Square, Robinhood, Sonder, Brex, Udemy, Gusto, BlockFi, and AngelList.

“The appropriate identity verification and management strategy will differ significantly depending on the business. A travel company verifying guests will have different needs than a delivery service onboarding couriers, or a cryptocurrency company granting access to funds,” Song added. “Even businesses within the same sector should personalize the identity verification experience for each customer to achieve a competitive advantage.”

Beyond Sign-On: An Identity Infrastructure

Song emphasizes that Persona’s value extends beyond the initial sign-on and verification stages.

“We’ve developed an identity infrastructure because we support businesses not just at a single point in time, but throughout the entire customer relationship lifecycle,” he stated to TechCrunch.

A substantial portion of the company’s growth in the previous year stemmed from existing customers discovering new applications for the platform, in addition to the acquisition of new clients, according to Song.

“We’ve observed existing customers identifying increasingly diverse ways to utilize Persona. For instance, we initially collaborated with some clients on a single use case, and now we may be assisting them with ten different challenges – ranging from account creation to investigating malicious actors and facilitating account recovery,” he explained. “This has likely been the most significant driver of our growth.”

Investor Confidence and Future Plans

Index Ventures Partner Mark Goldberg, who will be joining Persona’s board as part of the funding, expressed his admiration for the positive feedback Persona received from companies within the Index portfolio.

“We’ve been closely monitoring this space for some time,” he told TechCrunch. “We began to witness rapid adoption of Persona within the Index portfolio, and there was a clear sense of a powerful and user-friendly tool, which hadn’t previously existed in this category.”

Goldberg also highlighted the appeal of Persona’s personalization capabilities and its building block-based approach to a wider range of users.

“There are numerous methods to verify a user’s identity online, and providing flexibility to design the optimal path to a positive or negative determination can lead to significantly improved outcomes,” he said. “We consistently heard that the use cases were not standardized, and I believe this resonates in an era where customization is expected.”

Persona intends to allocate its new funding to expand its team by another 100% by the end of the year, supporting its growth and continued business scaling.

Other companies in the identity verification space that have recently secured substantial funding rounds include Socure and Sift.