Jumio Valuation Said to Be $100 Million After Andreessen Funding
Jumio Inc., which lets consumers make payments online by waving a credit card in front of a webcam, has a valuation of more than $100 million after its latest funding round, two people familiar with the matter said.
The people asked not to be named because the valuation numbers aren’t public. The Mountain View, California-based startup said today that venture capital firm Andreessen Horowitz, co-founded by Internet pioneer Marc Andreessen, led a $25.5 million financing round.
Jumio is trying to make online payments safer and easier in part by tackling fraud, a challenge that has plagued companies from the earliest days of the Web, Jumio founder and Chief Executive Officer Daniel Mattes said in an interview. He said he aims to strike partnerships with technology companies, retailers and banks -- including Facebook Inc. (FB), Groupon Inc. (GRPN) and Microsoft Corp.’s Skype -- to streamline payments.
“Skype, Airbnb, Facebook, Groupon Inc. -- all of them have the same problem,” Mattes said. “They’re accepting credit cards, and they have to deal with fraud.”
Jumio uses image-recognition technology to help people make purchases securely. One of its products, Netswipe, reads a credit card waved in front of a webcam. The other, Netverify, validates a user’s identity via a driver’s license or passport. The company makes money by charging the companies that use Netswipe as much as 2.75 percent of each transaction, and those that use Netverify $1 per verification.
With the investment, Andreessen Horowitz partner Scott Weiss will join Jumio’s board, which already includes Facebook co-founder Eduardo Saverin, an early investor. This round of funding will bring the total raised to $32 million, and let Jumio add 50 to 100 people to its staff of 45, Mattes said. Bloomberg LP, the parent of Bloomberg News, is an investor in Andreessen Horowitz.
Jumio’s challenge will be to stay relevant as banks and credit-card companies push consumers to go cardless and use handsets to make purchases instead. Payment networks, such as Visa Inc. and MasterCard Inc., advocate near-field communication technology, which lets people make payments by tapping a mobile phone against a cash-register system. One in five smartphones will be NFC-enabled by 2014, researcher Juniper estimates.
Mattes, 39, founded Skype competitor Jajah before selling it to Telefonica SA (TEF) for more than $200 million in 2009. Jumio will seek to strike partnerships with card-issuing banks as a way of gaining access to their millions of consumers, he said.
Google Inc. and PayPal both have products that let users keep a virtual wallet with information from several credit and debit cards, and use it to check out at online stores. PayPal, owned by EBay Inc. and formerly headed by another Andreessen partner -- Jeff Jordan -- could be an ally, Mattes said.
“We see ourselves more like industry neighbors,” he said. “PayPal could actually use our technology for the sign-up process, the credit card uploading process.”
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