Identity verification startup Smile Identity raises $7 million in a Serie A raise purposefully to build its KYC verification tools for Africa. Smile Identity offers ID verification and KYC compliance driven by artificial intelligence designed for African faces and identities.
The new investment round was led by Costanoa Ventures, pan Africa venture firm CRE Venture Capital alongside participation from Intercept Ventures, LocalGlobe, Future Africa Ventures, and several other angel investors across the globe. Smile Identity’s current investors are Beta Ventures, ValueStream Ventures, Khosla Impact, and 500 Startups. Story Ventures also took part in the round.
The $7 million raise marks the largest investment into an African verification identity. Thus far the startup has raised $11 million. The new funding round will be channeled towards improving services, expanding to new markets, supporting new ID types, hiring more engineers, and support staff.
The deal will see John Cowgli of Costanoa join the board. Smile Identity was formed in 2017 by Mark Straub and William Bares. Straub and partners leveraged camera technology to come up with de-biased face recognition technology which accurately depicts Africa’s situation than the open-source algorithms relied upon by U.S. colleges.
TechCrunch reports that Smile Identity now operates in 6 markets namely; Rwanda, Nigeria, South Africa, Kenya, Uganda, and Ghana. The startup’s software is used in fintech, banking, public worker verification, ride-sharing, and telecommunications. Payment companies involved were such as Chipper Cash, PayStack, Paga, neobanks like Umba and Kuda, traditional banks like Stanbic IBTC, cryptocurrency exchanges, you name it.
Digital identity verification has become a crucial component of onboarding customers at telcos, banks, e-tailers/retailers, insurance companies, etc. According to market research firm Grand View, the global digital payments market projections set the growth rate at 19.4% between 2021 and 2028 to hit a value of US$236.10 billion.