Author: azeeadmin

Max Q is a weekly newsletter from TechCrunch all about space. Sign up here to receive it weekly on Mondays in your inbox.

This week actually includes two, since I was out last week for a Canadian national holiday (and back today for the U.S. one, ironically). There’s plenty to cover, including Blue Origin’s bidding process, lunar landers, spaceships launching at sea and the return of our very own space event.

Blue Origin’s big bid

Blue Origin is auctioning off one seat on its first ever human spaceflight, and the bidding got started at $1.4 million — or at least, the public bidding started there. Before last week, people had been submitting blind bids, but now Blue Origin is posting the top current bid to its website whenever it hits a new high. It’s currently set at $2.8 million, meaning it’s doubled since the bids opened up to public scrutiny, and presumably FOMO.

Everything’s building up to June 12, when the auction will conclude with a live, real-time online competitive bidding round. Seems likely it’ll at least cross the $3 million mark before all’s said and done, which is good news for Blue Origin, since run-of-the-mill tickets for the few minutes in suborbital space going forward will probably end up more in the hundreds of thousands of dollars range.

The winning bidder will be flying on July 20, if all goes to the current plan, and will be accompanied by other passengers selected by Blue Origin through some other mechanism. We don’t yet know who else will be on the ride. Bezos maybe?

SpaceX’s Deimos spaceport is under construction

SpaceX is really flexing its sci-fi-made-real muscle with its latest move: The company is turning two offshore oil rig platforms into floating spaceports, and one of the two, codenamed ‘Deimos’ after one of Mars’ moons, is already being worked on. SpaceX CEO Elon Musk shared that the company is hoping to have it ready for operations next year, meaning it could host actual launches in 2022.

Eventually, Deimos and its twin, Phobos, will provide launch and landing services to SpaceX’s first fully reusable launch vehicle — Starship. Starship only just managed to land successfully after a high, but still very much atmospheric flight test, however, so it has a way to go before it’s making amphibious departures and arrivals using the converted oil platforms.

Putting these in the ocean presumably helps solve some key issues, not least of which is being mindful of the impact of launching absolutely massive rockets on land anywhere near people. Ditto the landings, which at least early on, are bound to be risky affairs better carried out with a buffer of surrounding ocean.

Landers; lunar ones

There’s quite a bit of lunar lander news this week, including Japan’s ispace revealing that it’ll provide commercial lunar lander service to both Canada and Japan, with a ride for both provided by SpaceX and its Falcon 9 rocket. These will be two separate missions, with the first one set for next year, and the second one set to take place in 2023.

Both will use ispace’s Hakuto-R lander, which it originally developed to take part in the Google-backed Lunar XPRIZE competition. That ended without a winner, but some companies, including ispace, continued to work on their landers with an eye to commercialization. The Hakuto-R being sent on behalf of JAXA will carry an adorable ball-shaped Moon robot which looks like a very novel take on a rover.

Meanwhile, GM announced this past week that it’s working with space industry veteran Lockheed Martin to develop a next-gen Moon rover that will provide future lunar astronauts with more speed and greater range. GM and Lockheed will still have to win a NASA contract in order to actually make the thing, but they’re clearly excited about the prospect.

TC Sessions: Space is back in December

Last year we held our first dedicated space event, and it went so well that we decided to host it again in 2021. This year, it’s happening December 14 and 15, and it’s once again going to be an entirely virtual conference, so people from all over the world will be able to join.

We had an amazing line-up of guests and speakers at last year’s event, including Rocket Lab’s Peter Beck, NASA’s Kathy Lueders and more, and we’re already working on a fantastic follow-up agenda that’s sure to thrill all kinds of space fans.

You can already get tickets, and if you get in early, you save $100.

Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast where we unpack the numbers behind the headlines.

This is Equity Monday Tuesday, our weekly kickoff that tracks the latest private market news, talks about the coming week, digs into some recent funding rounds and mulls over a larger theme or narrative from the private markets. You can follow the show on Twitter here and myself here.

We are back from a long weekend here in America. But not break here in the States can stop the flow of global tech news. So, here’s the rundown:

• The Weekend: Tata bought BigBasket, setting up a fascinating ecommerce war in India. China is cracking down on edtech companies, leading to an IPO freeze. And Wejo is going public via a SPAC. You can read its investor deck here.
• This Morning: The are a zillion funding rounds in Europe and globally this morning, the start of what could be a super busy week’s cycle. Private Equity is buying Cloudera, which is a surprise. Nio had chip shortage issues that impacted its delivery cadence. The Chinese EV company does expect to meet its Q2 delivery goal, however.
• Funding Rounds: Truebill raised $45 million. Chipper Cash raised $100 million. Zenyum raised $40 million. WeFox raised $650 million. Malt raised $97 million. Sennder raised $80 million. idwall raised $38 million. Belvo raised $43 million. And that was not even close to all the big ones.
• Riff: Late last week we missed the Sprinklr filing. You can read it here. Quite a number of VCs have money riding on the IPO.

Welcome back, America, to the week. It’s nice to see you, everyone else. Maybe Robinhood will file this week.

With COVID-19 restrictions lifting and employees starting to make their way back into offices, hackers are being forced to change tack. While remote workers have been scammers’ main target for the past 18 months due to the mass shift to home working necessitated by the pandemic, a new phishing campaign is attempting to exploit those who have started to return to the physical workplace.

The email-based campaign, observed by Cofense, is targeting employees with emails purporting to come from their CIO welcoming them back into offices.

The email looks legitimate enough, sporting the company’s official logo in the header, as well as being signed spoofing the CIO. The bulk of the message outlines the new precautions and changes to business operations the company is taking relative to the pandemic.

If an employee were to be fooled by the email, they would be redirected to what appears to be a Microsoft SharePoint page hosting two company-branded documents. “When interacting with these documents, it becomes apparent that they are not authentic and instead are phishing mechanisms to garner account credentials,” explains Dylan Main, threat analyst at Cofense’s Phishing Defense Center.

However, if a victim decides to interact with either document, a login panel appears and prompts the recipient to provide login credentials to access the files.

“This is uncommon among most Microsoft phishing pages where the tactic of spoofing the Microsoft login screen opens an authenticator panel,” Main continued. “By giving the files the appearance of being real and not redirecting to another login page, the user may be more likely to supply their credentials in order to view the updates.”

Another technique the hackers are employing is the use of fake validated credentials. The first few times login information is entered into the panel, the result will be the error message that states: “Your account or password is incorrect.”

“After entering login information a few times, the employee will be redirected to an actual Microsoft page,” Main says. “This gives the appearance that the login information was correct, and the employee now has access to the OneDrive documents. In reality, the threat actor now has full access to the account owner’s information.”

While this is one of the first campaigns that’s been observed targeting employees returning to the workplace (Check Point researchers uncovered another last year), it’s unlikely to be the last. Both Google and Microsoft, for example, have started welcoming staff back to office cubicles, and some 75% of executives expect that at least 50% of employees will be back working in the office by July, according to a recent PwC study.

Threat actors typically adapt to exploit the global environment. Just as the shift to mass working over remote connections led to an increase in the number of attacks attempting to exploit remote login credentials, it’s likely the number of attacks targeting on-premise networks and office-based workers will continue to grow over the coming months.

The cybersecurity industry has no shortage of technology to fight against network intruders, app corrupters, email hackers and other cyber criminals. Today a startup called Redacted is coming out of stealth with a different approach to tackling malicious activity — it applies threat intelligence, and then proactively goes after the hackers to recover data loss and disrupt their activities announcing some funding to build out its business — and announcing $35 million in funding to fuel its growth.

The Series B is being led by Ten Eleven Ventures, with participation from Valor Equity Partners and SVB Capital. (Ten Eleven is a VC specializing on cybersecurity that has backed a number of other startups.) It brings the total raised by Redacted — which it specifically styles “[redacted]”…with brackets — to $60 million.

It’s always interesting when a startup comes out of nowhere with a substantial about of VC backing, but it’s almost always because that startup has some interesting pedigree, and that is the case here. The company is led by Max Kelly, who was previously the chief security officer at Facebook and before that held roles at the National Security Agency and U.S. Cyber Command. His co-founder, John Hering, was the founder and CEO of cybersecurity firm Lookout. The startup is populated out with a bigger team that the startup likes to say has “more than 300 years of combined experience” in cyber defense with experience at Facebook, Amazon, NASA JPL, Symantec, Cisco, FBI, CIA, NSA, DIA, Army, Air Force, Navy, US Marine Corps, US Cyber Command, the UK’s GCHQ.

I’d actually heard about the company before — it works with another cyber startup I’ve covered called Cado, which provides cyber forensics tools to Redacted (among others) — but when I mentioned I’d heard of the company previously, they suggested it was because I’d covered Ocado and its move into the U.S. market, so while Redacted is not particularly forthcoming about its customers, I guess that this grocery giant might be one of them.

The core of what Redacted does comes out of direct experience that Kelly said he had while working at Facebook, where he both built in-house threat response tools but also worked with third-party vendors to secure the social networking giant’s systems, employees and users.

“A big focus of the industry in last 10 years was preventing the breach,” Kelly said. “But that was always a lie. There is nothing you can do to prevent a breach. The point is not to prevent the breach but the damage from it. Make sure people can’t get data out, and if they do, make sure you can get it back.”

There was also the issue of the size of Facebook itself.

“We couldn’t buy any security tools that worked because of the scale of the company,” he said. “So we thought about it and decided that the best approach would be to ask who is doing this, get them to stop.”

In an environment where cybercrime has taken on the profile of some of the most advanced innovations in technology, with both bad actors and security apps and services leaning on artificial intelligence and automation to do their work, it sounds almost too human an approach. But from how Kelly describes it, it sounds like there is a very human face to cybercrime, and the mere fact of identifying bad actors can get them to retreat.

It’s also a highly technical operation: the startup has also built tools, with some of its own tech and leaning on tech built by others, to find patterns in the work that cybercriminals do and eventually track them to where they are.

“If they’re in a place where they can be touched by law enforcement, that can be used to get them to stop,” he said. “But if not, then it’s just the awareness that they’d been seen and that generally causes them to retreat.”

The mix of what Redacted has built to date, he says, is being aimed at smaller, mid-sized and slightly larger corporates, particularly those that are not capable of building tools like this themselves.

The name, meanwhile, in my opinion says something about the nimble, but also very focused, approach the startup is taking. It comes from a period when the company hadn’t yet come up with a name for itself but was already operating commercially while in stealth mode (which actually is very standard among cybersecurity startups, I’ve found, who don’t really want a lot of attention for obvious reasons).

“We used it as a placeholder, but I realized, as I talked to people, that they were using the name “Redacted” when referring to us,” Kelly said. He looked up redacted.com and saw it was available. “It was the universe telling me to use the name,” he said with a little smile.

“With the industry’s most advanced pursuit capabilities, Redacted has the power to teach attackers that companies will hold them accountable for attacks,” said Alex Doll, founder and managing general partner at Ten Eleven Ventures, in a statement. “Redacted’s cloud-native security platform also enables them to protect and defend companies that run their operations within a modern cloud architecture. Together, these features enable [redacted] to offer the most holistic and proactive security solution for companies in today’s elevated threat environment.” Doll is joining the board with this round.

Cloudera was once one of the hottest Hadoop startups, but over time the shine has come off that market, and today it went private as KKR and Clayton, Dubilier & Rice, a pair of private equity firms announced they intended to purchase Cloudera for $5.3 billion. The company has a market cap of around $3.7 billion.

Cloudera and Hortonworks, two key startups in the Hadoop space, merged in 2018 for $5.2 billion.Cloudera was likely under pressure from activist investor Carl Icahn, who took an 18% stake in the company in 2019 and now stands to gain from the sale, which the company stated represented a 24% premium for shareholders at $16 a share. Prior to the market opening this morning, the stock was sitting at $12.86.

Back in the day, about a decade ago, when Hadoop was the way to process big data, venture money was pouring into the space. Over time it lost some of its glow. That’s because it was highly labor intensive, and companies began moving to the cloud and looking at software services that did more of the work for them. More modern technologies like data lakes began replacing it and the company recognized that it must change its approach to survive in the modern data processing marketplace.

Cloudera CEO Rob Bearden sees the transaction as a way to do just that. “We believe that as a private company with the expertise and support of experienced investors such as CD&R and KKR, Cloudera will have the resources and flexibility to drive product-led growth and expand our addressable market opportunity,” Bearden said in a statement.

While there is a lot of executive jargon in that statement, it basically means that the company hopes that these private equity firms can give it some additional financial resources to move towards a more modern approach for processing large amounts of data.

While it was at it, Cloudera also announced a couple of acquisitions of its own to help it move towards that modernization goal. For starters it grabbed Datacoral, a startup that abstracts away the infrastructure needed to build a data pipeline without using code. It also acquired Cazena, a startup that helps customers build cloud data lakes, giving the company a more modern approach to processing big data.  Bearden sees both of these services helping Cloudera reposition itself in the big data self-service market

“Both businesses will enable our combined customers to enjoy a reduction in complexity and faster time to value for their data initiatives, leading to improved insights, faster innovation, and stronger engagements with their customers and partners,” Bearden said in a statement.

Cloudera went public in 2018, closing at $18.09 a share after raising a $1 billion. The vast majority of that was a $740 million investment from Intel Capital in 2014.

Hortonworks raised another $248 million. A third Hadoop startup, MapR raised $280 million. The company’s assets were sold rather unceremoniously to HPE in 2019 for a price pegged at under $50 million, showing just how far the market has fallen since its earlier glory days.

The Cloudera deal includes a brief “go shop” provision that allows it continue to look for a better deal. It’s doubtful it will find one, and if it doesn’t the transaction with KKR and CD&R is expected to close in the second half of this year subject to typical regulatory review. The company will announce earnings later today.

Just about every week there’s a blockbuster round coming out of South America, but in next door Central America, which mostly is less affluent, things have been more hush hush. However, Kushki, a Quito, Ecuador-based fintech, is bringing attention to the region with today’s announcement of a $86 million Series B and a $600 million valuation.

“We never thought that we would return home [from the U.S.] and build a company that was more valuable in Ecuador than we had built in the U.S.,” said Aron Schwarzkopf, CEO and co-founder of Kushki.

Schwarzkopf and his business partner, Sebastián Castro, had previously built and sold a fintech called Leaf in the U.S. in 2014. The two are originally from Ecuador but moved to Boston for college, where they met watching soccer.

Unlike many other fintechs in Latam that are out to help the unbanked, Kushki works behind the scenes building the tech infrastructure that companies like Nubank use to transfer money. Some of the functionalities they build enable both local and cross-border payment players in credit and debit cards, bank transfers, digital cash, mobile wallets, and other alternative payment methods.

“We realized there was a gigantic opportunity to democratize and create infrastructure to move money,” Schwarzkopf told TechCrunch.

The company, which was founded in 2017, already has operations in Mexico, Colombia, Ecuador, Peru, and Chile. The Series B will be used to accelerate growth and expand to Brazil and nine other markets in Central America.

Generally, expanding to Brazil is an expensive proposition, and therefore not a path that all companies can take, even though it can be an extremely profitable move if done right. Some of the challenges include the need to translate everything into Portuguese followed by the varying financial regulations.

That’s why Kushki’s approach has to be somewhat custom in each country.

“We focus on going into the markets and we basically rebuild an entire infrastructure, so we put everything into one API,” said Schwarzkopf.

Products similar to Kushki have been successful in other regions around the world, such as in India with Pine Labs, Africa with Flutterwave, and Checkout.com that now has 15 international offices.

To build all this infrastructure, Kushki, which means “cash” in a native Andes dialect, has raised a total of $100 million from SoftBank, an undisclosed global growth equity firm, as well as previous investors including DILA Capital, Kaszek Ventures, Clocktower Ventures, and Magma Partners.

“From now until 2060, people will need servers and ways to move money, and we knew that the existing payment infrastructure couldn’t support that,” said Schwarzkopf.

A technical system underpinning the European Union’s plan for a pan-EU ‘digital pass’ for verifying COVID-19 vaccination or test status across the region has gone live today, with a handful of EU Member States connected to the gateway and more expected to follow ahead of a July 1 full launch.

The idea for the EU’s COVID-19 digital certificate is to offer a single system for securely verifying EU citizens’ COVID-19 status — whether vaccination; a recent negative test; or proof of recovery from the virus — as they cross borders within the bloc to help facilitate safer travel.

The digital pass relies upon QR codes and digital signatures — verified using public key cryptography — to prevent falsification. Paper-based certificates can also be used by those who do have access to a device.

Member States that have passed technical tests and are ready to do so can start issuing and verifying certificates on a voluntary basis, the Commission said today — with seven countries (Bulgaria, Czechia, Denmark, Germany, Greece, Croatia and Poland) intending to do so at this point.

Other countries have decided to launch the EU Digital COVID Certificate only when all functions are deployed nationwide, it added. Further details about Member States’ status on activating the system are available via this webpage.

Since 10 May, 22 EU countries have tested the gateway successfully, according to the Commission, which wants maximum update of the system by 1 July — when the associated regulation will apply.

Although it’s allowed a “phasing-in period” of six weeks for the issuance of certificates for Member States that need additional time to get everything hooked up. That means it’s possible the tardiest implementations could happen when summer is all but over. (An earlier goal of EU lawmakers that everything would be up and running everywhere by June always looked ambitious.)

The Commission says no personal data is “exchanged or retained” during the COVID-19 digital certificate verification process, noting that the signature keys for the verification are stored on servers at a national level. These keys can be accessed — via the gateway — by national verification apps or systems all across the EU.

The Commission has also developed reference software and apps for the issuance, storage and verification of certificates — which it’s published on GitHub — to support the rollout by EU Member States. The Commission said 12 Member States have made use of this code so far.

National authorities in respective EU countries are in charge of issuing the COVID-19 digital certificate to individuals — with various potential routes for citizens to obtain one, such as from a COVID-19 test centre or from their local health authority or directly via a national eHealth portal.

Commenting on the gateway launch in a statement, Stella Kyriakides, the EU’s commissioner for health and food safety, urged Member States to get on and complete their implementations.

“The EU Digital COVID Certificate shows the value added of effective e-health solutions for our citizens,” she said. “It is important that during the coming weeks, all Member States fully finalise their national systems to issue, store and verify certificates, so the system is functioning in time for the holiday season. EU citizens are looking forward to travelling again, and they want to do so safely. Having an EU certificate is a crucial step on the way.”

Also touching on the COVID-19 digital certification launch today, Commission president, Ursula von der Leyen, said the system will only be in place for one year — presumably that’s assuming the pandemic is actually over by summer 2022.

“The EU certificate is a prime example of digital tools that represent our values,” she said, in a speech addressing the 2021 Digital Assembly. “The EU values privacy. No personal data will be exchanged or retained. The EU is inclusive. Whoever is not vaccinated, can get a digital certificate for test or recovery. Whoever does not have a smartphone, can get it on paper. With the certificate, we want to help people to move freely in times of pandemic. This is why it will only be in place for one year. Europe is a front-runner here and can set standards at the global level.”

In the speech, the Commission’s president also trailed another incoming digital proposal which she said would provide Europeans with a trusted online ID they could use to interact with regional governments and businesses without being forced to hand over more data than is strictly necessary.

“We want to offer to Europeans a new digital identity. An identity that ensures trust and protects users online. We are about to present our proposal,” she said. “It will allow everyone to control their identity online, and to interact with governments and businesses, across the EU. Nobody should be forced to give more data away, than is necessary for the purpose at hand. To book a hotel room online, no-one needs to know where I am from and who my friends are. With our proposal, we are offering an alternative to the models of big online platforms. We believe in a human-centred digital transition.”

Personal finance startup Truebill has raised a $45 million Series D funding round led by Accel. This comes just a few months after the company raised a $17 million Series C. Overall, the startup has raised $85 million since its creation.

Existing investors Bessemer Venture Partners, Cota Capital and Eldridge Industries are also participating in today’s funding round.

Truebill offers several tools to help people living in the U.S. take control of their finances. One of the app’s key features is that you can track all your subscriptions in one place. Users can also cancel unwanted subscriptions. For cell phone and cable bills, Truebill can negotiate a discount for you.

More recently, the startup has been adding features to turn the app into a financial companion. You can see spending insights, create a healthy monthly budget and track it from the app, view your credit reports and more.

Truebill also lets you put some money aside automatically. The company analyzes your accounts to save some money when you have some money left.

Now, the company is working on a wealth management dashboard that centralizes all your assets and debt. Wealth management is a bit tedious as you need to connect to every single pocket of money otherwise you don’t see the full picture.

“More than 10,000 members sign up for Truebill every day seeking to better understand and improve their finances,” co-founder and CEO Haroon Mokhtarzada said in a statement. "With this new capital, we’re transforming Truebill into an all-in-one, holistic platform that makes it easy for members to not only manage subscriptions and spending but also optimize their savings and make informed decisions to improve their financial health. Truebill is rapidly becoming the most valuable financial membership for everyday consumers.”

As you can see, the startup is growing at a rapid pace. The user base has doubled from 1 million to 2 million users since November 2020. The company analyzes $40 billion in monthly transaction volume.

Belvo, a Latin American startup which has built an open finance API platform, announced today it has raised $43 million in a Series A round of funding.

A mix of Silicon Valley and Latin American-based VC firms and angels participated in the financing including Future Positive, Kibo Ventures, FJ Labs, Kaszek, MAYA Capital, Venture Friends, Rappi co-founder and president Sebastián Mejía (Rappi), Harsh Sinha, CTO of Wise (formerly Transferwise) and Nubank CEO and founder David Vélez.

Citing Crunchbase data, Belvo believes the round represents the largest series A ever raised by a Latin American fintech. In May 2020, Belvo raised a $10 million seed round co-led by Silicon Valley’s Founders Fund and Argentina’s Kaszek.

Belvo aims to work with leading fintechs in Latin America, spanning across verticals like the neobanks, credit providers and personal finance products Latin Americans use every day.

The startup’s goal with its developer-first API platform that can be used to access and interpret end-user financial data is to build better, more efficient and more inclusive financial products in Latin America. Developers of popular neobank apps, credit providers and personal finance tools use Belvo’s API to connect bank accounts to their apps to unlock the power of open banking.

As TechCrunch Senior Editor Alex Wilhelm explained in this piece last year, Belvo might be considered similar to U.S.-based Plaid, but more attuned to the Latin American market so it can take in a more diverse set of data to better meet the needs of the various markets it serves. 

So while Belvo’s goals are “similar to the overarching goal[s] of Plaid,” co-founder and co-CEO Pablo Viguera told TechCrunch that Belvo is not merely building a banking API business hoping to connect apps to financial accounts. Instead, Belvo wants to build a finance API, which takes in more information than is normally collected by such systems. Latin America is massively underbanked and unbanked so the more data from more sources, the better.

“In essence, we’re pushing for similar outcomes [as Plaid] in terms of when you think about open banking or open finance,” Viguera said. “We’re working to democratize access to financial data and empower end users to port that data, and share that data with whoever they want.”

The company operates under the premise that just because a significant number of the region’s population is underbanked doesn’t mean that they aren’t still financially active. Belvo’s goal is to link all sorts of accounts together. For example, Viguera told TechCrunch that some gig-economy companies in Latin America are issuing their own cards that allow workers to cash out at small local shops. In time, all those transactions are data that could be linked up using Belvo, casting a far wider net than what we’re used to domestically.

The company’s work to connect banks and non-banks together is key to the company’s goal of allowing “any fintech or any developer to access and interpret user financial data,” according to Viguera.

Viguera and co-CEO Oriol Tintoré founded in May of 2019, and was part of Y Combinator’s Winter 2020 batch. Since launching its platform last year, the company says it has built a customer base of over 60 companies across Mexico, Brazil and Colombia, handling millions of monthly API calls. 

This is important because as Alex noted last year, similar to other players in the API-space, Belvo charges for each API call that its customers use (in this sense, it has a model similar to Twilio’s). 

Also, over the past year, Belvo says it expanded its API coverage to over 40 financial institutions, which gives companies the ability to connect to over 90% of personal and business bank accounts in LatAm, as well as to tax authorities (such as the SAT in Mexico) and gig economy platforms.

“Essentially we take unstructured financial data , which an individual might have outside of a bank such as integrations we have with gig economy platforms such as Uber and Rappi. We can take a driver’s information from their Uber app, which is kind of built like a bank app and turn it into meaningful bank-like info which third parties can leverage to make assessments as if it’s data coming from a bank,” Viguera explained.

The startup plans to use its new capital to scale its product offering, continue expanding its geographic footprint and double its current headcount of 70. Specifically, Belvo plans to hire more than 50 engineers in Mexico and Brazil by year’s end. It currently has offices in Mexico City, São Paulo, and Barcelona. The company also aims to  launch its bank-to-bank payment initiation offering in Mexico and Brazil.

Belvo currently operates in Mexico, Colombia and Brazil. 

But it’s seeing “a lot of opportunity” in other markets in Latin America, especially in Chile, Peru and Argentina, Viguera told TechCrunch. “In due course, we will look to pursue expansion there.” 

Fred Blackford, founding partner of Future Positive, believes Belvo represents a “truly transformational opportunity for the region’s financial sector.”

Nicolás Szekasy, co-founder and managing partner of Kaszek, noted that demand for financial services in Latin America is growing at an exponential rate .

“Belvo is developing the infrastructure that will enable both the larger institutions and the emerging generation of younger players to successfully deploy their solutions,” he said. “ Oriol, Pablo, and the Belvo team have been leading the development of a sophisticated platform that resolves very complex technical challenges, and the company’s exponential growth reflects how it is delivering a product that fits perfectly with the requirements of the market.” 

Online fraud and identity theft is a global problem that has only been exacerbated with increased online transactions amid the COVID-19 pandemic. In particular, it is estimated that Brazilian companies lose over $41 billion due to fraud every year.

In an attempt to tackle this problem head on, Lincoln Ando and Raphael Melo started idwall in mid-2016. São Paulo-based idwall started as an automated background check solution and has since grown into a suite of data and identity validation and risk analysis products. For the consumer market, its “MeuID” app is aimed at users who want to change the way they identify themselves and share their data.

And now the Brazilian regtech has raised $38 million in a Series C round led by Endurance.

GGV Capital, monashees, Canary, Qualcomm Ventures, ONEVC, Peninsula and Norte also participated in the funding, bringing its total raised to nearly $50 million.

The company says it has grown 1,458% between 2017 and 2020, with average growth of 144% per year. Its more than 300 clients include 10 unicorns, two out of the three biggest banks in Brazil and companies such as iFood, Claro, Cielo, Loggi, Ebanx, QuintoAndar and OLX, among others.

Fintechs make up a significant portion of its client base, and in 2020, the company saw its revenue from clients in the financial industry alone climb by 588% compared to 2019.

Idwall uses machine learning and AI to automate the onboarding process via its face match, background check, risk analysis, ID validation and automated optical character recognition (OCR) offerings to help companies avoid fraud.

The company said its APIs verify personal documents and information by searching in public and private databases “quickly and pursuant to the compliance rules.” Idwall does all this by first validating that an ID is authentic. Then it works to ensure the person using it is actually the owner of the ID. And lastly, it runs a full background check. It claims it does all this in less than three minutes.

“We help them do all these onboarding processes in a safer, better and faster way,” said idwall co-founder and CEO Ando.

Over the years, idwall has generated more than 65 million data reports for its clients, a number that it says surged by 5,000 times between 2017 and 2020.Those reports, it claims, have helped its clients scale their operations, register more of their own clients and optimize compliance and KYC processes, as well as reduce fraud.

In general, the pandemic’s drive to digital led to a massive increase in the number of digital bank accounts, mobile payment services and also of companies adjusting to digital platforms and/or expanding their digital operations — leading to a boom in business for idwall.

“The more digitized companies become, the more client expectations grow — and market competition grows stronger,” Ando said. “Our mission is to always stay ahead of innovation in our market, and that’s why we invest so much in growth and in building the best possible team to develop our products.”

Part of that includes using its new capital to recruit more developers, strengthen its existing products and release new ones. Idwall plans to increase its headcount from its current 200 to about 300 over the next few months. The company is also examining the possibility of expanding outside of Brazil to all of Latin America. 

“Many of the identity validation and fraud problems faced in Brazil are seen in other Latin American countries as well,” Ando said. “Besides, places like Mexico and Colombia also have highly innovative companies pushing the envelope when it comes to identity and technology. We still have a lot to achieve in Brazil, but we see a big opportunity for us to take our mission even further.”

Still, in its home country, recent regulatory changes in Brazil in recent years have also led to an increase in demand for idwall’s offerings.

In addition, Brazil’s documentation databases are highly siloed, the company says, with each state having its own model for the most common identity document, the RG (“Registro Geral” or “General Registry”). Plus, each citizen can be issued a different RG document in each state.

“It’s undeniable how much digital onboarding and automated identity validation processes are fundamental for the Latin American market to reach as far as it has the potential to,” Ando said. “It’s extremely difficult to understand and validate identification and personal data in Brazil.”

Also, in general, the company has observed how weary Brazilians are of having to show their IDs for routine events. Idwall helps with that via its aforementioned “MeuID” solution, which stores in a single wallet all the documents necessary for the onboarding processes of fintechs, startups, office buildings and other businesses.

Its investors are, naturally, bullish.

Hans Tung, GGV Capital’s managing partner, describes idwall as a “one-of-a-kind” startup. 

“idwall is leading the discussions and innovations in Brazil regarding digital onboarding and identity validation,” he said. “And their B2C digital identity app MeuID could be the first true super-app in Latin America.”

GGV aims to invest in category leaders that are using technology to create positive impact for its users and for society, Tung added.

“The idwall founders are tackling a huge yet underserved problem in Brazil, and have led the company through terrific growth,” he said. “They have the ingredients to become the leading personal data platform in LatAm for the enterprise.”

Marcos Toledo, managing partner at Canary, notes that idwall was one of his firm’s first investments.

“Lincoln and Raphael’s abilities to build and scale a business solving a very relevant problem in Brazil have caught our attention,” he told TechCrunch. “Their culture, tech level and agility as a company also are very remarkable in the Brazilian market.”