February 7, 2022

Scale First, Funding Second: Lessons on Going International with Onfido’s Husayn Kassai

Melissa Malec

Conventional wisdom requires growth to happen from a solid base, but start-ups can succeed with a great idea, founders who are committed to it, and a clear understanding of the market. As is clearly the case for the founder of Onfido, Husayn Kassai. 

As scale-ups grow, they need to focus on disseminating their culture through new hires as well. People who have only worked with you a few months will soon outnumber the team from day 1: make sure they know who you are, and who they’re expected to be.

Right from day one, building a company will expose you to an array of difficult new situations. It’s never boring, but it can be exhausting, stressful and strange. Learning to be present in the moment and to spend less time and energy worrying about the past and future can make it more manageable and get you better results.

Key Takeaways:

  • Founders have to lead. From geographical expansion to instilling company values, everything else is optional — but not this. 
  • Look for external success drivers. Where are the waves you can surf, that will deliver a tailwind to success?
  • Don’t wait too long. Some first-mover advantages are insurmountable. Look to those, not to whether you fit an external definition of readiness.
  • Focus on staying grounded. Learning to be present helps you make better decisions and reduces stress.

What was the thinking behind Onfido, and the journey to date? 

We recently acquired a $100 million funding round, but my co-founders and I started as part of the Oxford University incubator program. We could see that the identification process was broken and getting worse. Organisations were moving online, but they still only really had two options when it came to verifying people. Our approach is for you to take a photo of your government ID and a short selfie video. That’s a lot more convenient than the face-to-face in-branch experience and a lot more secure than a credit bureau or centralised-database approach.

Camera phone quality, internet connectivity, facial biometrics, and other technologies came together to create both the need and the opportunity for this new standard in identity verification and authentication.

What would you say have been some of the key drivers of your success to date? 

Overall, smartphones, and brands like Myspace, Facebook and Twitter, accustomed consumers to a much better user experience. Apart from that, we’ve experienced two waves of technological transformation that we’ve ridden.

The first wave was about marketplaces, home sharing, car sharing, and on-demand services like tutors and nannies. With no face-to-face interaction to verify them, the need for digital verification became really important. 

As that developed, we saw ideas like BlaBlaCar, which is car-sharing from city to city. Our machine learning model was developed to recognise more IDs and to catch fakes and fraudsters, even the sophisticated ones.

The second wave involves FinTech: online payments, remittance lending, crowdfunding banking — accompanied by much better customer experience, usually smartphone-driven, and a smooth sign-up journey.

What has been the most important lesson from expanding to the US?

The rule of thumb in the corporate world is usually you have to have $20 million in revenue before you expand to a second location, because there are so many challenges. But we had about £20,000 of revenue when we expanded.

As far as key lessons, the necessary components are, it should be founder-led where possible, and it requires great product-market fit together with a solid understanding of local nuances and differences. 

The third point is, if you go on and show success, you have to be ready to scale fast before competitors do.

How did you balance timing and finances when you expanded to the US market?

We got a contract, worth about $50,000 or something. When all your other contracts add up to $30-40,000, $50,00 seems like a big deal, but in fact, it’s a small contract by US standards.

In the US, we were able to be very lean; we kept costs at almost zero. It was me with a backpack, relying a lot on my parents who live in California. The fourth year, 2017, was the first point at which we started to routinely win contracts. 

If we'd started in 2017, we would have just started preparing to launch in the States, which would have been too hard and too late.

Was expansion into mainland Europe ever part of your plan?

If you win in Europe and no market elsewhere in the world, forgoing the US, a US company with 10 times your funding will either buy you or win the whole market. 

If you win the US and nowhere else, you can gain enough investment to move from there into all the other markets. So we knew really early on that winning the US wasn't optional, it was necessary.

Our focus is to standardise the way you share your legal or real identity. This standardisation process is machine learning-driven, so the provider that gets the most data to build the best models will gain a first-mover advantage in the race for data. 

When you were scaling the company to come to new markets, what did you do around your company culture to ensure that that scales with you?

One of the toughest things is to make sure you have a clear culture that you continuously celebrate and strengthen. We have nine offices, and we only really launch one if we have a team member that exemplifies the culture and is able to go and launch that office. I started the US office and then two or three of my colleagues joined from the UK.

We had this incredible engineer who wanted to go back home to Portugal, and we said, great, go start the Portuguese office. So we have 60 colleagues in Lisbon in our second engineering office now, because that engineer was able to embody our culture and build a whole new office around that.

Talk me through the role of learning in the Onfido culture.

Most people at tech companies are lifelong learners, who often start their careers young and relatively inexperienced. We launched before we graduated.

If you don't feed that enthusiasm and curiosity, you’ll see people not feeling fulfilled and therefore losing some interest; and if you want to win a competitive race, everyone needs to be on their very best performance. To do that in a fast-changing world, you have to be up to date and build constantly expanding skill sets.

How have you found the shift to remote? Do you think it's something that you'll continue to do post-lockdown?

About 10% of us were working permanently remotely before COVID-19, and now it's obviously 100%. Scale-ups are in a good position to work remotely, agile by definition, with hot-desking, squads, and so on. Early-stage startups with fewer than 10 or five people need fast feedback and whiteboard sessions and face-to-face time. Very large, established corporates take longer to adjust. 

Naturally, we do remote identity verification in a remote working world. So we saw a surge in volume. Some of our customers were critical to the recovery process, so impact and mission came into it as well. 

How has your productivity changed in this period? 

In the office, when the lights go off at six or six-thirty, you pack and go, but at home, it's harder. For parents, maybe you have to wait until six-thirty and talk with them in the evening so they can handle childcare during the day.

Sometimes it's also good to share those understandings and lessons, especially with a younger, less experienced team. We have our ‘all-hands’, where the whole company gets together Friday at four-thirty, and we've made that as entertaining and interesting as possible. Team leads check in with their teams in weekly one-on-ones, including on a personal level. 

What measures should companies like Onfido, and the tech sector more broadly, take around diversity and inclusion?

Every year for several years we’ve doubled our team size, so we’ve been working harder to diffuse our culture and values through the organisation so that people know what we’re about, and as a company, we generate actual practical policies towards diversity and inclusion — as opposed to saying that we're against racism.

We do that in part through our products. We have an accessibility feature so that if you're partially blind, you can still access services.  And we've done a specific initiative to improve our facial recognition technology for darker skin complexions because as you know, accuracy is lower for those subjects; we showed a 10X improvement on darker-skin facial recognition similarity. 

A team member from the States asked, ‘if I attend the Blackout Tuesday protests, would it count against me?’ Our answer was, we encourage you to. You have paid leave. We want you to use it for things like this. 

What are the main things you're hoping to achieve with your new wave of funding? 

Half of the world's population are not on the credit bureau. I remember when my parents first moved here from Iran, they struggled to rent, open bank accounts and do other basic things because while they had ID, they weren’t in the system. Now anyone in the world with a government ID and a camera-enabled device can gain access. 

The intention for the next eight to ten years is to take that to the next level. Part of that will be helping everyone in the world to own and control their own legal identity in a very frictionless and easy way. Now, if you need to sign up with your bank account, or rent a car, it's 10, 20, 30, or 40 clicks. 

We want to reduce that to two or three clicks, and usually, the biggest point of friction is identity authentication. So we’re working towards a better experience for many more people.

Can you tell us a bit more about the COVID-19 passport Onfido is working on? 

We’ve been working on immunity or health passports:  presentable proof of your health status, that you can show to organisations like a care home, hospital or airport.

There are two parts to it. One is an app that connects to the test results. We’re not involved in that part. The other half is connecting the app to your physical identity in the real world. That’s the part we specialise in, making it so that only you can use the app.

There are several pilots. Some governments are interested, as well as private companies, and there’s a range of use cases including travel, leisure, and return to work. The intention is to help people get back to work or to help with the relief efforts, but to do it in a safer way.

What's one key learning you'd like to share which has been quite pivotal in your career?

My first year at university, I read some spiritual books. I find that those who excel in their field are typically those who do a good job of focusing on one thing. There are many who have written good stuff about this — Eckhart Tolle is my favourite; one learning has been to read about the topics of stillness and being present, and I think that has helped me quite a bit. 

Being a startup CEO can get surreal sometimes and you can lose yourself. You can start thinking you're some sort of special king, whereas in reality, it's been a team effort and luck and timing have a big role to play. If I had a chance to tell other founders and others to do one thing, it would be this.

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