ID.me is a startup based in McLean, V.A., led by two U.S. army veterans. The startup has made it possible for major retailers — like overstock.com, Under Armour and TaylorMade — to validate customer identity, more specifically military credentials, through a purely online process. An early alum of D.C.’s startup incubator 1776, ID.me CEO Blake Hall confirmed to DC Inno that the security startup has raised $3 million in a new venture debt round — USAA led the round. Hall told DC Inno he is confident the company could also raise another $4.5 million from the Series B/bridge round, though. The new money comes as ID.me is expecting to close numerous major, nationwide partnership deals in the coming months. “We’ve never seen so many big brands integrating with us at one time,” the CEO said.
Though Hall said he could not comment on partners that haven't launched yet, Coca-Cola, Hershey's, and TaylorMade were all big wins for his company over the last couple of months. A large component of ID.me’s optimistic momentum also comes from the forthcoming launch of Connect.Gov — an initiative built via a federal contract they were recently awarded. Connect.Gov is a credential broker between identity providers and the federal government. The idea is that citizens will be able to use a Single Sign On across government agencies so as to streamline the registration process across different government websites.
Hall regarded the contract as a “game changer” and "big milestone." He said,“Given the imminent launch of Connect.Gov and the strongest quarter we've had to date in retail and ticketing, our funding will allow us to stay laser focus on execution during a critical growth period.”
Aside from investment round leaders USAA, V.A.-based Blu Venture Investors joined the round as did several other angel investors. Kelly Perdew, co-founder and CEO of TargetClose, was one of those angel investors — he is currently a board member of ID.me. The identity confirmation startup charges its clients up to $1 per verification. In addition, it can make a commission each time shoppers are referred from its own website to a client’s business.
In the past, military personnel would need to fax, mail or otherwise share personal documentation and details to effectively receive membership deals. As a result, it left them vulnerable to identity theft or fraud. It was an archaic system in desperate need of renovation and ID.me filled that void in the retail market. Online retailers that use ID.me can market deals to specific customer groups via their cloud software, including first responders, teachers, university students, employees at a particular company, or active military personnel and U.S. military veterans.
Regarding the recent deal traction activity, the ID.me CEO said “Larger brands typically look for strong credibility, analyst reports, commercial traction, etc before integrating a young company. We're at a point now where we've satisfied that criteria; the only other companies certified to Federal and Identity Access Management (FICAM) Level of Assurance 3 (a government certification that allows users to access sensitive personal information from federal agencies) are Verizon and Symantec.”
Naturally, cybersecurity plays an influential role in the proper dissemination of extensive personal information over the web. And ID.me understands this, Hall proclaimed, “Trust underpins our value proposition. We take cybersecurity incredibly seriously. We've also architected our ecosystem to decentralize certain components of our credential service in a way that will be clear to our users in the not too distant future.”
To date, ID.me has had quite the promising start to 2015. I asked Hall where he hoped the company would be in terms of revenue growth and market expansion by year’s end. He said, “Our growth is driven by our integrations, so this question is difficult to answer because it is partner dependent and some of those partners are sizable enough to drive millions of interactions annually. With that being said, Matt and I would like to see: our integrated partner churn rate remain at zero, tens of millions of trusted credentials accepted across ID.me's network, and millions of transactions occurring between citizens and federal agencies through our technology. Now that our core infrastructure has been built, our forward looking headcount will be driven by revenue which is a function of partner integrations."
