Smile Identity has raised a sum of $7 million to scale its product that helps Africans prove their identity online. The round was led by Costanoa Ventures as well as pan-African venture firm CRE Venture Capital.
Other investors that took part in the funding round include Intercept Ventures, Future Africa, LocalGlobe and undisclosed angel investors. This is Smile Identity’s second major fundraising since it launched 4 years ago in 2017. The first funding was for the sum of $4 million and was raised in 2019.
Headquartered in California in the United States, Smile Identity was founded by Mike Straub and William Bres.
The company provides an ID verification and KYC compliance infrastructure for companies in different fields including fintech, banking ride-hailing and cryptocurrency. Its tech solutions are used in 6 countries which are Nigeria, South Africa, Sierra Leone, Uganda, Ghana and Kenya.
As more parts of commerce move online, being able to verify one’s identity digitally is crucial in order to access the many services and financial offerings that are being offered. Yet, about 1 billion people in the world have challenges with identifying who they are online, according to the World Bank.
Data shows that 81% of this set of people live in sub-Saharan Africa and Asia while 47% are below the national id age of their country. Even when Africans hold formal IDs, they still spend an excessive amount of time verifying that they are who they claim whether it is for the purpose of doing business or travelling.
It verifies identities with 15 ID authorities across the 6 countries, with its identity validations covering more than 250 million people.
Smile Identity’s innovation builds on the advancements that governments and non-profits have made and creates a “technology layer that makes Africa’s new and old ID systems accessible and useful for the next generation of African technology companies.”
This technology will make processes like onboarding new customers or employees easier for companies across Africa. Before its latest investment, a number of other investors have believed in and funded the business. They include Story Ventures, 500 Startups, ValueStream Ventures and Khosa Impact. These investors also participated in its new round.
With this funding, the startup will improve and scale its innovations as well as expand into more markets. It will add verification support for more ID types in order to offer customers an even more diverse solution set. According to the company, it already has 80 customers which include Twiga, Paystack, Umba, Paga, ChipperCash and Kuda Bank, Binance, Luno, Paxful and Stanbic IBTC.
Alongside the $7 million funding, Smile Identity also now has a new board member. Recall that Costanoa co-led this funding round. One of its partners, John Cowgill, will be joining Smile Identity’s board.
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