Footprint: AI, Biometrics, and the Battle Against Identity Theft with Eli Wachs

In this episode of Company Breakdowns, host Lorenzo Bartolini and Footprint Co-founder and CEO Eli Wachs discuss the complex landscape of digital identity verification and fraud prevention. Wachs explains how his company addresses the growing sophistication of identity fraud through "portable identity" infrastructure, enabling secure user onboarding for financial services.

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LINKS:

Footprint: https://www.onefootprint.com/

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X:

@lozo_the_bozo (Lorenzo)

@EliWachs (Eli)

@turpentinemedia (Turpentine)

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KEY HIGHLIGHTS:

• 42 million US adults were victims of identity fraud in 2023 - that's 1 in 5 people, with $30-50 billion lost annually
• AI is exponentially worsening fraud by enabling sophisticated synthetic identities and deepfakes
• Most current identity verification is fundamentally flawed - companies blindly send data through APIs without observing user behavior
• Footprint's "portable identity" approach treats fraud as a math problem: instead of finding every fraudster, detect when two people claim the same identity
• Former Macau mafia now operates sophisticated fraud networks from the Laos-Myanmar-Thai border, targeting Americans through "pig farming" operations
• The identity verification market is worth $700 million with room for multiple public companies
• Synthetic identity fraud accounts for 20% of credit losses at some lenders and is the fastest-growing fraud type
• Fraudsters have significant advantages: no red tape, no bureaucracy, and fraud is their full-time job
• Early customers won't question your trustworthiness - they believe in your vision so deeply they don't think to ask
• Contrarian startup advice: win on price early, be willing to act as a "dev shop" for large customers, and measure success by customer testimonials
• The Power Broker hiring rule: automatically hire any frontend engineer who has read the 1,600-page book about urban planner Robert Moses
• Network effects will determine winners - first company to 150 million portable identities gains major advantage
• "If you live in America, your identity's been leaked" - focus should be on detection and mitigation, not prevention
• Best identity protection remains surprisingly analog: passkeys, two-factor authentication, and verification through trusted channels