$15.5M raised by Incognia to focus on mobile location authentication
Incognia, a Silicon Valley-based behavioral biometrics and location authentication provider, has raised a $15.5 million Series A from Point72 Ventures to better position its mobile identity authentication software and diversify its platform.
In May, the company added three location identity modules — location spoofing detection, global mobile address validation and trusted device intelligence — to its digital identity and fraud detection mobile products that leverage location as a potent form of authentication.
Collecting anonymous GPS, Wi-Fi, cellular and Bluetooth radio data produces what Incognia CEO Andre Ferraz calls a “device fingerprint” that locates the device and whoever is carrying it as they try to enter a secured facility.
From there, it compares a log-in attempt to a location template of the user that produces a risk score that enables entry or denies it.
Transitioning Incognia from a behavioral biometrics firm to one that is centered on location authentication is a return to Ferraz’ roots, he says in an interview.
He started his career in security research with passive authentication for Internet of Things applications. After founding a company that analyzed location data for marketing, he revisited the cybersecurity field in 2020 with Incognia to leverage location technology for authentication use.
“The reason why we didn’t execute this business in 2010 when I was a security researcher was basically because the market wasn’t ready. But it’s good to finally, 12 years later, be working on this,” Ferraz says.
The CEO says he initially positioned Incognia in location-based biometrics because it was a “hot space” at launch, but the company later concluded that location authentication was “more powerful” compared to behavioral biometrics, which led it to reposition to location intelligence for mobile devices.
The location authentication technology developed by Incognia is claimed to have a false acceptance rate of 1 in 17 million, which the company says is 10 times more powerful than FaceID’s facial recognition.
Ferraz says there were challenges with introducing location authentication. It created additional pressure to evangelize his new form of authentication.
Yet, being a pioneer in location authentication also bore fruit, as most of its clients were onboarded as an inbound lead because they were searching for location authentication solutions and found Incognia first on search engines. He sees the company becoming a reference in the market now, rather than competing in an existing market.
Despite the switch of direction, Ferraz views the location authentication technology as complementary to biometrics. “For me, there is no silver bullet when it comes to security and authentication. It really depends on the use case and the sensitivity of the transactions.”
Ferraz says he has found the ideal stack for authenticating users securely without introducing too much friction. It is a combination of device fingerprinting, location intelligence, behavioral biometrics and on-device biometrics.
“If you combine these four things, I think you can create a fantastic user experience, but at the same time, secure the users with confidence,” he says. “These things are complimentary in many use cases, where our solution is used as the primary signal and there are other use cases in which where it is the secondary use signal.” But he notes that it depends on the industry, use case, and the type of transaction.
The success of Incognia’s location authentication solution pushed it to raise capital.
Ferraz says, “It’s a new category, a new form of authentication. It’s more challenging to be the first one. But after executing this business for a few years, we saw that 100 percent of the companies that were testing the solution decided to buy it, and the retention rate was 100 percent.” Incognia says it has more than 200 million users in 20 countries, with customers in the United States, India, Brazil and Mexico, which highlights the company’s global retention and reach, Ferraz notes.
Ferraz says Point72 Ventures was approached for funding because he recognized their knowledge and connections in fintech, which is Incognia’s primary market. It also serves clients in cryptocurrencies, gaming, delivery and social media.
“Incognia is at the forefront of mobile identity and authentication, and any mobile app that touches money has the potential to benefit from their solutions,” says Adam Carson, partner at Point72.
With the $15.5 million, Ferraz says the first plan is to accelerate on the commercial side. The sales team of Incognia is four people, something that is going to change soon.
Secondly, it looks to move from being mobile-only to other channels, including web authentication and ATMs, to leverage mobile devices and their signals as an authenticator.