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Ipsidy rebrands to reflect biometric authentication focus, prepares for uplist

Intercede and Patriot One report, China facial recognition unicorns face regulators
Ipsidy rebrands to reflect biometric authentication focus, prepares for uplist

Ipsidy is now known as authID.ai in a rebrand amid a flurry of organizational moves by the biometric authentication provider. The company has also announced a reverse stock split at a 1 to 30 ratio, with the intention of making it easy for traders to invest in the company’s mobile biometric identity verification solutions as it plans to list on a national exchange.

Tom Thimot, former CEO of Socure, has been appointed CEO of authID, while Tripp Smith has been named President and CTO. Thimot and Smith worked together at Clarity Insights (now Accenture AI), where Thimot was CEO and Smith was CTO. Former CEO Philip Kumnick and former CTO Philip Broenniman will relinquish their positions to focus on their roles with authID’s Board. Five new board members will join them, including Thimot, Standard Chartered Bank CIO Dr. Michael Gorriz, PwC Global Advisory COO Michael Koehneman, Progress Partners Managing Director Sanjay Puri, and Temenos Americas President Jacqueline White.

Departing board members Theodore Stern and Herbert Selzer are thanked in the announcement, which also notes that Founder Thomas Szoke is leaving the board, though he will remain AuthID’s chief solutions architect.

AuthID is also enhancing its ID-as-a-Service (IDaaS) biometric platform with expanded artificial intelligence capabilities to deliver the highest level of performance, speed, security, privacy and accuracy with reduced user friction.

“During the last 12 months, we have made strategic investments in our product, our channel partners, and our delivery model, all of which combined to establish our Company as a substantive player in identity authentication.” states Chairman Phillip Kumnick.

The reverse stock split has been anticipated since the company announced its intention early this year to uplist to a national exchange.

The ratio was determined by Ipsidy’s Board of Directors after the company approved the reverse stock split at its annual shareholders’ meeting in late-March. Common stock in Ipsidy will trade under the temporary ticker symbol ‘IDTYD’ for 20 business days. After that, the company will trade under the ‘AUID’ ticker symbol.

No fractional shares will be issued, and fractional shares resulting from the reverse split will be rounded up to the nearest whole share.

The shares began trading on a split-adjusted basis on Monday, June 14, 2021.

Intercede doubles pre-tax profit

Higher revenues for Intercede drove the company’s pre-tax profit for fiscal 2021 to £1.1 million (US$1.6 million) double its 2020 year, on higher demand for its digital identity services, according to MarketWatch.

The COVID-19 pandemic reduced Intercede’s revenues in several key markets in Europe and the Middle East, but U.S. revenues increased by 14 percent, and overall revenue increased by 6 percent to £11 million ($15.5 million).

Intercede will not pay a dividend this year, and said it plans to continue investing in its products.

Patriot One narrows net loss despite dry spell

Revenues recorded by Patriot One declined to $0.2 million in its third quarter of fiscal 2021, with most of the difference from $1.2 million in the same period a year earlier due to a $0.7 million government contract that concluded.

Net loss was $3.2 million for the quarter, and $9.7 million for the past nine months, compared to net losses of $5.2 million and $18.7 million in the equivalent periods a year earlier. Patriot One attributes the decreased loss to streamlined business operations, COVID-19 relief funding and transaction costs in the comparable period from an acquisition.

The company has been awarded contract commitments worth $2.2 million since the end of the quarter, April 30.

“We continue to see an upturn and strong acceleration in market activity, resulting in a significant increase in the number of customer engagements, site surveys, demonstrations and trials” states Patriot One CEO Peter Evans. “With this momentum, along with our new focused sales organization and our strengthening sales pipeline, I am very optimistic, and believe we are well-positioned to deliver a strong end to our fiscal year.”

Biometrics unicorns face China’s regulators ahead of potential IPOs

The hurdles faced by Chinese facial recognition unicorns and biometrics companies in getting their initial public offerings off the ground are reviewed in a Global Times article.

Megvii, Cloudwalk, Yitu and SenseTime have all filed paperwork showing they are at least considering IPOs, but the state-owned publication says regulators have increased their consideration of data security and compliance issues, contributing to a series of delays and changed venues.

The four companies make up around 51 percent of the domestic face biometrics market, according to Global Times.

CloudWalk applied for a listing in Shanghai in December, and Megvii was granted initial approval for a listing in March, just as Yitu gave up its bid, but Megvii is unsure if it will have to go through another round of approval. SenseTime is reportedly considering a listing either in Shanghai or Hong Kong.

A real estate sales center is reported have used Megvii’s biometric algorithms to identify and offer promotions to potential customers, which was discovered in March, evoking public criticism. The firm responded that its customer is responsible for how the technology is deployed.

Megvii has lost some 13 billion yuan (US$2 billion) so far, largely due to its investments in research and development, and the Times says the company projects that it will need 2.05 billion yuan ($320 million) in cash flow over the next three years. Yitu has lost 7.23 billion yuan ($1.1 billion), while Cloudwalk has lost 2.28 billion yuan ($356 million).

If they are to access public investment, a Chinese academic tells Global Times the biometrics unicorns must convince regulators and investors that data will be managed in accordance with the law, and make their customers sign agreements that they will not abuse their facial recognition.

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