Sumsub launches proof of address document recognition, plans $80M-$100M Series B
Sumsub adds proof of address (PoA) document subtype recognition to grant its fintech clients a more accurate picture of the kind of documents that are submitted to perform know your customer (KYC) and anti-money laundering (AML) compliance.
The customer onboarding provider supplies face biometrics to authenticate users, and says it now allows user verification flows to be adjusted to specific regulatory requirements because companies can set unique rules based on the type of document that was submitted. Some examples include telecom, mobile operator, and utilities bills; government-issued statements like voter registration or tax bills; and bank statements and certificates.
Sumsub cites a problem around PoA where the legitimacy of the permanent residence document is not assured. Bank statements and tax bills are considered PoA, but other are associated with high forgery rates or high risk like mobile phone bills, due to SIM cards being purchasable regardless of long-term residence. With its document subtype recognition, Sumsub says its clients can now see what kind of document is submitted as PoA based on regulator requirements.
“With our Proof of Address document subtypes check, you can leverage risks with your service accessibility. It is now easy to differentiate rules based on the type of the document submitted,” says Andrew Novoselsky, chief product officer of Sumsub.
“For instance, you can offer a higher deposit for your applicant if they use a bank statement, or allow them less if they verify their address with a mobile bill,” he explains.
Sumsub says the document subtype recognition will add five to 10 more seconds to the PoA verification.
Sumsub doubles run rate in 6 months, prepares to raise funds
Sumsub Co-founder and Chief Technology Officer Viacheslav Zholudev confirmed plans to raised $80 million to $100 million in Series B funding on a YouTube show hosted by Nathan Latka, who believes the company is a “secret unicorn.”
In an interview with Latka, Zholudev went through his journey with Sumsub, from its founding as an anti-Photoshop software in 2012 that did not go very far (“There was no market for it”), to a pivot in 2015 towards using face biometrics and document analysis to authenticate customers for KYC/AML and KYB. Zholudev says Sumsub currently has 1,000 total customers, with 40 tier 1 customers that pay more than $100,000 per year for its services, with some paying over $1 million. Its top client is billed $7 million per year, with the average customer paying $10,000 to $20,000 per year.
Sumsub recently released a case study showing how its selfie biometrics have helped improve KYC speeds and pass rates for fleet rental software company MyMove.
With Sumsub raising $6 million in 2020 and half going to secondary funding, Zholudev said he’s happy the team built a product with “almost no external funding, and we’re cash flow positive.” The company’s growth impressed Latka, who pointed to its annual run rate of $45 million to $50 million in 2021, up from $20 million to $25 million six months prior. Latka estimates that Sumsub is in the top 2 percent of fastest growing SaaS companies in the world.
Responding to an inquiry over Sumsub’s future funding plans, Zholudev said it is aiming for $80 million to $100 million in Series B funding which they can pursue as it is not ‘burning money” with its “luxury position.” As he is a chief technology officer and not part of the financial team, he could not divulge what valuation range the company would be happy with, as even the financial team isn’t sure either. “I’m afraid to lie right now because if I calculated and multiply something then it probably wouldn’t be the right number” he said with a grin.
But Latka estimates that Sumsub could raise possibly 30-fold, feasibly 45 to 50-fold, their valuation at a $40 million to $45 million run rate. With that figure, Latka believes it would be valued at $1.3 billion, turning Sumsub into a unicorn.
Despite the goal of funding, Zholudev says it is currently more important for Sumsub to find strategic partnerships to expand into new markets to establish offices in new regions. They are also seeking interesting mergers and acquisitions partnerships. The funding would help the firm invest in stronger marketing efforts, as it is currently focused on the quality of its product and promoting its success via word of mouth.
According to Crunchbase, Sumsub has currently raised $7.5 million.