Smile Identity, an African-based focused solution that provides identity verification and KYC compliance for African faces and Identities, raised $20 million in Series B funding to accelerate the development and adoption of its AI-powered identity verification tech and expand to new African markets.
ID verification and KYC compliance have become necessary for Africa as fintech adoption grows. Smile Identity noted in a report that fraud rates on the continent reached an all-time high of 28% in 2022, with stolen and forged identities playing a major role.
In July 2021, the startup announced a $7 million Series A financing. This most recent Series B financing was co-led by the Silicon Valley investor Costanoa Ventures and the Africa-focused venture capital firm Norrsken22. Costanoa Ventures was one of the co-leads in that round. Norrsken22 general partner Lexi Novitske will join the board of the business.
The participating investors included existing ones such as ValueStream Ventures, Intercept Ventures, Latitude, Future Africa and 500 Fintech. New investors like Commerce Ventures, Courtside Ventures and Two Culture Capital were given recognition in the round.
One of the features of Smile Identity’s product is its guarantee of end customers’ signature to a client’s platform, whereby customers are authorized to take a selfie at onboarding against their IDs, making it easier for clients to identify the customer better by confirming their faces and rejecting unknown and subsequent sign-ups in the case of fraud.
Smile’s expansion plans
The latest round of funding will help Smile extend the development into new markets, particularly in Francophone and Arab-speaking countries. The company remains optimistic that its war chest allows it to partner closely with ID authorities and governments to create consumer consent standards and enforce local African data protection laws across the continent.
Mark Straub, Smile CEO, said on a call with Techcrunch, “If you onboard a customer and don’t check biometrics, you may be missing 50% of the fraud. The biometric deduplication engine [our smart selfie], which is trademarked as our face recognition technology, can be used both at onboarding and at the stage of deduplication and authentication.”
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 series B funding foretells some reforms to be expected. As for some of its competitors like (Youverify, YC-backed Identitypass, and Dojah), the company is at the forefront of taking the lead because of its deep relationships and expertise.
Straub says the firm is established in over ten countries after recently opening offices in London and Cape Town. It is a market leader because of “an incredibly diverse team and best-in-class technology”. He added, “We bring those two things together and focus on delivering the best outcomes for our clients.”
Read More; Ghana’s OZÉ raises $3m in pre-series A round to scale operations in Ghana and Nigeria
About Smile
The six-year-old company, launched 18 months ago by Mark Straub and William Bares, performs over 1 million identity checks monthly with access to over 250 million identities and verification for 15 different ID types across six African markets.
The product is accessible in Nigeria, Kenya and South Africa, and its CEO claims the company grew its clientele across all these products by more than 100% over the last year and tripled its revenues within the same time frame
Mark Straub revealed that this recent launch of its Document Verification product would enable Smile Identity to expand its capabilities,
Read More; Nigeria’s Jendaya raises $1.2m pre-seed funding to scale its e-commerce platform in Africa
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