By MVL • May 9, 2024

Identity in the age of AI: a founder's perspective with John Baird of Vouched

MVL caught up with John Baird, Co-Founder and CEO of MVL spinout Vouched, to discuss AI's revolutionary role in identity verification and its broader impact on business-consumer interactions. Baird highlights AI's pivotal challenges and opportunities in today's digital world.

MVL: How has your background equipped you for leading startups today?

John: My early experiences are in crisis communications, particularly working on the Firestone tire recall, which was a complicated issue involving various stakeholders, cultures, and political implications. The experience is foundational for how I think about marketing and business in general.

When transitioning from crisis communications to problem-solving with AI and identity verification, it was clear that we had to solve a two-sided problem. We needed to create a seamless and frictionless revenue-generating experience while simultaneously verifying individuals' identities at a high level for security. This strategic thinking was foundational in creating both our product and go-to-market approach.

At Vouched, we reject the status quo or habit-based thinking, where we simply do tomorrow what we did yesterday. I believe this is a fundamental flaw in human reasoning.

Successful businesses are innovative, not necessarily in creating something entirely new and novel, but in attacking problems differently.  Great businesses tackle problems in wholly new ways, which is at the core of problem-solving.

MVL: Absolutely. Can you give me an elevator pitch for Vouched?

John: We develop artificial intelligence for the complicated task of verifying identity remotely, and we do this for legacy industries that are going through digital transformation, where verifying the identity of that customer is mission-critical for them. You're opening the gate to revenue when you do it well in the way that Vouched does it because you're making it easy and seamless, as opposed to a barrier, which forces customer abandonment. Then you have to get it right on the security side, too, because there are also big fraud implications. That's the core. That's what we do.

MVL: Identity verification is crucial in healthcare. How does Vouched navigate the complex regulatory landscape in healthcare? Do you have advice for any startups looking to enter regulated industries?

John: At Vouched, we initially focused on helping healthcare organizations verify individuals' identities seamlessly and effectively, as required by trust, safety, and HIPAA regulations. As we worked with customers and received their feedback, we learned that this is more than just a one-and-done task. Our customers' input was critical to our product's evolution, and their compliance teams and lawyers helped us build within the confines of healthcare regulations.

Building for highly regulated industries like healthcare or financial services is ongoing, as rules constantly change. However, this ensures another level of differentiation and allows the business to charge a price premium, as the product will continue to evolve through continuous innovation.

In industries requiring compliance, you need domain experts to help navigate the space, but their expertise can't limit you. Experts can be so ingrained within the rules of their area that it becomes difficult for them to innovate beyond those boundaries.

MVL: That's interesting. What drives you as a founder?

John: My constant pursuit of innovation is inherent to who I am. The best entrepreneurs live in a state of annoyance with various things, which is difficult to turn off. Businesses that innovate demonstrate that they care about their customers. Amazon is an excellent example of this.

I've been a loyal customer for over two decades and have never had a complaint. In fact, Amazon out-innovates my ability to think of improvements; they implement enhancements before I even consider them. By consistently prioritizing the customer experience, their bottom line continues to outperform, as evidenced by their financial results over their nearly 30-year history.

MVL: Given the dynamics of working in such a rapidly changing environment, how do you stay motivated and afloat?

John: The dynamic challenges of our field are what excite me. Specifically concerning identity, I find two major themes absolutely critical. In the pre-digital world, identity was inherently baked into the operations of every business. It wasn't itemized separately; it was simply part of operational costs. For example, when you went to the front of a store to make a purchase, whether it was a high-value item on a credit card or a regulated product like a bottle of wine, there wasn't a separate process for identity verification. It worked because we had millennia of human evolution and business practices that naturally incorporated these processes.

However, digital transformation disrupts this seamless integration, creating a significant gap in how business is conducted concerning identity. We're excited to bridge this gap at Vouched by building a new worldwide trust network. This network allows identity to function in the digital realm in ways that are radically different from and more effective than in the pre-digital world.

Additionally, identity today is more valuable than ever, which may initially seem counterintuitive. All value-based decisions, particularly in the digital world, start with identity verification. This impacts everything from financial transactions to healthcare access.

For instance, over the past year, we've helped nearly a million new immigrants in the United States gain access to banking services. These individuals might otherwise have continued living on the margins of society, handling cash, which is riskier and more expensive than having a banked economy. This shift protects them from financial instability due to theft or natural disasters and integrates them into the economy, providing opportunities for substantial economic improvement.

Even when things get tough and we're pulling all-nighters to solve problems, knowing that we are making a real difference in people's lives drives us to continue. This sense of purpose sustains me and the entire team at Vouched.

MVL: Beyond AI, what emerging technologies will impact identity verification and cyber security most in the coming years?

John: It's hard to look beyond AI and its potential impact, much like trying to predict what would come after software 50 years ago. An economist recently hypothesized that AI might transfer power back to the middle class by empowering artists, songwriters, musicians, and even farmers to utilize AI without the need for a team of engineers.

As identity becomes increasingly valuable, there will be more risk associated with it. As we become more mobile and conduct more activities remotely, ensuring that we interact with and approve the correct individual becomes more complicated.

The future of identity looks radically different from today, and both businesses and individuals need to actively stay on top of it, along with partners like Vouched that are looking for identity-related threats. This ongoing process needs to happen continuously throughout every single day.

Founder Spotlight is a series dedicated to bringing you insights into the founder journey, lessons learned from startup leaders, and a behind-the-scenes look at some of the most compelling tech companies in our community.

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