Rodger Desai

Speaker A: Welcome to another episode of FinTech Talks. I'm Sanjeev Khalida, and I'm so excited to have our guest today. Roger. Roger, uh, would you mind please, introducing yourself?

Speaker B: Yes, Sanjeev. I'm Roger Desai, CEO of Prove Identity.

Speaker A: Wonderful. And can you talk a little bit about your background?

Speaker B: Yeah, I've been, um, an entrepreneur for, uh, quite a long time, mostly trying to find new uses for the amazing things our pockets call cell phones. Uh, at pruv, we use the cell phone as a way to authenticate transactions.

Speaker A: Um, I think one commonality that we both have is that we're both, uh, former engineers. We used to, uh, build. Actually build things, uh, like physical things or technical things and, and made that transition. Can you talk a bit about your, you know, what you used to do as an engineer?

Speaker B: Yeah, well, you know, my mother said I had to be either an engineer or a doctor, and I still don't know where my heart is exactly, so I married a doctor instead. Um, you know, engineering was, uh, it does, does teach you a really great way to think about problems and, um, you know, just maybe give you some raw capabilities, um, that, um, in a world that's increasingly technology driven, it gives you kind of a solid foundation. I just didn't want to actually be an engineer. Um, and so as soon as I could find my path out of that, I did.

Speaker A: You know, when we first met, you know, I describe as sort of the early days of prov. And obviously now you've taken that company quite a ways. Talk a little bit about the company and how you started and where you're at now.

Speaker B: Yeah, original insight. Um, so, first of all, we didn't have any background in banking fraud risk. Uh, so we didn't come from kind of the traditional places that, um, try, uh, to do KYC and those type of compliance processes. Uh, instead, we came from a background of knowing how phones work. And I helped build some early phone companies. Uh, one, uh, was called Airtel in Spain, which is now voted for in Spain. And I was always amazed at how amazing phones, uh, are. It's, um, if you think about, like, the experience of using your phone, which we kind of take for granted, you can take your phone anywhere in the world and it immediately works. You don't have to, like, create an account where you go. And because you don't have to, like, assert who you are. Like, they don't ask you when you land in a new country, like, who are you? And how do you want to pay for your calls? Uh, you can't actually lie and pose to someone else. And so we were fascinated by the fact that this is kind of one service, uh, that consumers use where there is like no trade off between convenience, security and even privacy. And if you think about it, most of these transactions when you're traveling are real time cross border transactions because the visitor, you know, the phone company you connect with in the country you visit effectively is a merchant and accepts potentially not, you know, US dollars. So we're like, wow, it's amazing. There's already a system at scale that's uh, PKI based, that is convenient, secure, private, you know, and uh, does crossword transactions all at the same time. And the web isn't like that. Everything on the web is if you want things to be convenient, they may not be as secure as you'd want. And you're constantly fighting that trade off between those factors. The phone kind of does it all. It does that mainly because it's really not about the phone. It's about the fact that there's cryptographic keys like your SIM card. You know, that's really the magic of uh, know, authenticating keys versus verifying, you know, things that people say about themselves.

Speaker A: What did you specifically target?

Speaker B: Yeah. So um, the model we said is, uh, again we try to be inspired by regulators but try to go beyond what they ask for. So today, just with simple process of opening a bank account, that process doesn't involve any authentication. It's basically a verification. So I could say, I'm Sanjib, I live here, you know, here's my national id, my date of birth. And you just have to make sure that data goes together in uh, several authoritative places. Now ah, that was designed at a time when it was considered really, really costly, if not impossible to get Sanjeev's uh, name, address, social date of birth, like where would you get such things? But now because of all the breaches, it's pretty trivial and inexpensive to get those things. So it's very easy to pass KYC checks. In our model, we think, we thought that verification and authentication should be unified. So for example, in our model, if you want to open a bank account, I can authenticate your phone and it can actually just pre fill that data, um, on your behalf, your name, your address, et cetera, with your consent. But the way to think about that is the only way that I can pretend to be Sanjib and apply for the account in his name is if I have his phone in my hand during the transaction. So that makes the bar much higher. But at the Same time it's much more convenient because I'm not typing in anything. So our notion of uh, doing things was we created something called an identity token. An identity token is basically a bind between your national ID and your phone and it allows you to kind of just authenticate your phone and that asserts who you are. Now of course the ability to create these tokens is not trivial because it doesn't come from some source. Uh, and persisting that as people make changes, like people you know obviously get new phones and change phone numbers and um, you know change their name if they get married, like all those things you have to triage all that, all these kind of life cycle events to maintain the accuracy of the token. But effectively we think the world should be tokenized and that way you get some of the benefits. I mentioned earlier, can you talk to

Speaker A: me a little bit about how uh, you've grown proove, you know, from that startup, from the startup days to you know, being where you are now and how, how you might break that up?

Speaker B: Yeah, great question. So Today Peru has 19 of the top 20 US banks. We have about 2,000 banks overall. We do lots of sectors outside of banking. In fact our non banking business is bigger than our banking business now. But the early days was a lot of work kind of getting that product market fit. The approach we have is quite different. Uh back then everyone thought the future of identity was scanning a passport or a driver's license and getting an otp. Um, but our view that was neither convenient or secure and it's um, getting those first few wins especially with large banks was a calling card to the rest of the market.

Speaker A: You know the way you might need to support a large bank versus a marketplace. Are there like major differences or are the needs sort of similar?

Speaker B: You know at one level it's all the same. People want to know is it really sanjib behind the transaction, um, whether you're opening an account, sending a payment, um, or in social media like making a post, uh, there are vast differences though. Banks really need to make sure they can explain their decisions um, for fair lending laws and other compliance measures that they have to adhere to. Whereas folks that aren't under those same obligations, they just want an answer. So in some cases we have to give a lot of data to help them make not just an accurate decision but to explain their decision. Uh for non banks they're really know more about the outcome and we kind of separate the world between builders and operators. So banks to us are uh, are builders where we help them with the outcomes, uh, operators want us to own the outcome.

Speaker A: You know, one of the areas that uh, and this obviously a hot topic right now and probably where the industry is going. You know you're thinking about like agent commerce and you know, AI. Yeah obviously AI and bots and things like that, like uh, you know, working in identity, it seems like it is very much like, you know, you got to keep ahead of the fraudsters and you know, the bad actors and like. So how, how are you doing that

Speaker B: with prove now another great question. I think we're such at an interesting time in you know, in life and industry of just you know, the uh, future uh, that awaits us with AI. Um, and obviously it's kind of an opportunity at a threat. Of course, obviously the attack surface is ah, great, much more uh, exposed because of AI and the cost of doing large scale attacks has dropped so much that there's just going to be a lot more attack. In fact we're seeing the amount of bots that proliferate the web in the digital economy is growing at a phenomenal rate. And these days these bots aren't the traditional ones where they're in some AWS cluster somewhere. Now it's not unusual for a fraud ring to buy 2 million IOT ESIMs, uh, provision them over the air and um, create fake accounts, create SMS pumping schemes, um, and all the scams that uh, consumers are led into they uh, can do that at an amazing cost profile. Some of these IoT sims cost pennies a month. So imagine a million of them, 2 million, 10 million, creating fake accounts and creating the havoc they do at the same time. Bots are potentially good because maybe you uh, told in an LLM to go buy these golf clubs if they hit a certain price point and that essential bot is uh, doing that on your behalf and maybe it tries to execute the contract at three in the morning when you're sleeping when it hits a certain price point. So now you have a world of humans, but increasingly bots that some are very malicious and some are just acting on your behalf. So to delineate all those things is quite important and that's something Pruv has spent uh, several years developing capabilities for. One thing that um, is notable is that we have so much insight into the tenure of your relationship with your phone and your um, authentication keys that um, that most of these agents don't have that tenure and behavioral activity. So if I'm a bad guy with a million EIMs that do bad things, well there's still the phone I call my mother with, and that's going to have the rich tenure activity that we see in our system. So it's really kind of a network view. Uh, and that allows us to delineate, you know, human versus bot and then good bot versus bad bot.

Speaker A: Uh, that's, um. I, I'd imagine that, like, sort of being on the inside, if you will, of, of, you know, observing the bad bots, like, it must. Do you do, do you feel worried at all, like, when you personally shop or, or use, uh, use your bank, uh, apps and things like that?

Speaker B: Well, I think as Americans, we've grown accustomed to, um, that if something bad happens, our bank covers us. So I guess that makes us all sleep well at night. Uh, but there are some new threats. Um, I think Americans have never looked at data privacy more seriously, um, than, uh, than today, with a lot of concerns around surveillance. So I think that, um, I probably worry about that more than I worry about, you know, my bank account being siphoned out. Um, but I think, um, you know, these are the new challenges that await us.

Speaker A: Oh, that, that's a lot to think about. And, uh, I wanted to ask you about your FinTech meetup experience and, you know, what was that like and, you know, what did you get out of it?

Speaker B: Um, well, I remember, um, when fintech Meetup was conceived, I think, during COVID and the idea was so brilliant, um, that, you know, and the idea for, you know, a lot of the things that the founders have done and even in other conferences is it's really just about the people. Right, right. Ultimately, it's about. This is an industry full of people. People like to do business with people they know, that they like, that they can trust. And, uh, that's obviously very hard to do during COVID when we couldn't see each other physically. So it's an amazing event because you get to connect and reconnect, uh, and build bridges into new relationships based on existing ones. Uh, and that's what drives business. I think if you look at how businesses gets done, it gets done with people you trust. Um, and those. Sometimes those relationships are built over decades. So it's an amazing place for us to get together, reconnect m with those who we know and build bridges into new groups of people, um, to continue expanding our business and our partnerships and

Speaker A: any advice you might give to, let's say, either a startup founder trying to build their business and attending some tech meetup, or even a bank trying to, you know, understand what, what's, what's the Lay of the. The new lay of the land.

Speaker B: Um, probably one is, uh, um, you know, show, don't tell. Like if you, you know, if you're a startup founder and you want. Look, we all want to meet the latest and greatest things that are coming out. Um, I think openclaw showed us that things can happen in a matter of days and take over the world. Uh, but the, the demos are, are amazing and that really helped prove in the early days. I wouldn't, I wouldn't. I, uh, wouldn't show a PowerPoint presentation and I wouldn't talk. I would just show them a demo. And I think that really is important, uh, to articulate, you know, uh, your vision. And that can be whether it's a big bank trying to do new things or a startup trying to break into

Speaker A: a big bank, you know, looking ahead at it. And I'm, um, I'm actually glad that we're on video because if I ask this next question, you might like, try to hit me or slap me. But, you know, when we first met, you were an upstart, but you are. I describe it as you're. You're a, you're part of the, uh, you're part of the M mainstream at this point. Is that a fair statement or would you disagree with that?

Speaker B: Uh, for sure. I think that, um, we, you know, we get past product market fit and you get, you know, eventually want to get the point where, like, you're profitable, we're profitable, we've been profitable for quite some time. Then you want to be global. We're global. Some of the brands that, uh, we work with, that are well known, uh, we are working with them 60 countries, going on 80 countries, uh, then ultimately becomes. Can you have that kind of, uh, durability? Every industry, every company gets commoditized. Uh, if you don't continue to have a North Star of where you put your value to us, that North Star has always been around that Rubik's Cube of incredible accuracy, uh, incredible coverage and incredible price point. There's one, uh, mentor that his line was, you, uh, have to be able to do things in milliseconds for millisense. And as you look at the market opportunity for identity, it's not just, uh, the most important things we think of, which is like opening a bank account, making a payment, but it gets into things like signing transactions, um, it gets into, uh, things like tokenized assets. Um, where today Uber and Airbnb showed us that there's all this supply hidden, um, that just wasn't exposed to the market. You can imagine there's, like, someone in Vietnam may want to buy 1/100th of my mother's house in Jersey. And those types of things, as assets get tokenized even beyond payments, like, there's going to be a tremendous need for identity. Um, so I think that, like, um, like, in. In one sense, uh, we've come a long way, and I think we're quite well known among the banks and fintechs and gaming companies and digital marketplaces. But. But identity has to be something that's core infrastructure. Uh, that's what we intend to be. And that's for, you know, transactions we haven't even thought of yet. Companies that don't even exist yet, as the global marketplace becomes truly, um, borderless.

Speaker A: That's amazing. And once, uh, again, um, thank you for joining us today, and I'm glad that, uh, we've been friends for so many years and, uh, look forward to meeting up again soon in life, in person.

Speaker B: Yeah. All right. Sanjeev, this was great. Thank you so much.

Speaker A: Thank you, Ranjit.