cheqd – a start-up whose technology could drive widespread uptake of digital IDs – has secured a $2.6m (£1.9m) investment to support the launch of its product later this year.
The latest funding round was backed by Outlier Ventures, Evernym, TitanBlock, Torque, 3GR and a consortium of private investors. It follows their initial investment in March this year and brings the total raised by the company to $3.3m (£2.4m).
cheqd’s software enables individuals to have their own digital ID that they can store on their mobile phone and use to verify their identity or information such as their qualifications, vaccine status or credit history. Like a passport or driving licence, it would be ‘signed’ by a trusted authority and accepted as proof of status by other organisations without the need to check the individual’s details on a central database.
The technology, which is based on blockchain, has been developed by a team led by Fraser Edwards and Ankur Banerjee. It is unique in that it not only enables organisations to create a digital ID, but also incorporates a payment system so they can charge users a fee to cover the cost, encouraging wider uptake. So for example, a bank that had carried out background checks on a new customer could provide him or her with a digital ID that they could use at other banks to avoid repeating the process.
Self-sovereign identity (SSI), as the concept is known, could be key to unlocking access to banking, government benefits or other services and research suggests it could boost economic growth by 3% in the UK in 2030. It also safeguards privacy by removing the need to store personal information on a central database and giving the individual control over what information they share.
Founders Fraser and Ankur – who met while working as analysts at Accenture in London – have spent the past seven years managing emerging technology projects and were selected to take part in Outlier Ventures’ Base Camp in spring 2021. The business currently employs a team of eight and is on course to launch its first product later this year. It will be aimed at tech firms developing digital ID solutions, as well banks, universities, hospitals or other bodies that issue credentials and may want to offer them in digital ID format.
Ankur Banerjee, the CTO, says digital IDs could save the time and cost involved in carrying out repeated background checks: “Covid accelerated uptake of digital technology but the question is, how do you prove your identity and build trust in an online world? Digital IDs give people control over their credentials which makes it easier and cheaper to verify their identity which makes banking and other services more accessible.
“However until now uptake of digital IDs has been limited because there is no business model that allows providers to charge for creating them. cheqd makes this possible for the first time and could act as a catalyst to encourage wider uptake.”
Fraser Edwards, CEO at cheqd, added: “cheqd aims to build the trusted data economy to give people and organisations back their privacy and control of their data. We would like to thank all the investors who share our vision and brought us this far. The strong interest we have had from investors signals that the market is ripe and there is a big demand to address the data security, privacy and trust issues linked to our identities.”
Jamie Burke, CEO at Outlier Ventures, added: “You can’t have Web 3.0 without a form of decentralised identity that works at scale and has a business model for network participants hardcoded into it. That’s why we firmly believe in cheqd’s mission as they enable SSI.”