Entrust Acquires AI-Powered ID Verification Startup Onfido for $650 Million, Sources Reveal

Onfido, a pioneer in identity verification utilizing computer vision and machine learning technologies, is set to be acquired, as confirmed. Entrust, the privately-owned company specializing in certification and verification services for payment cards, passwords, network access, and device security, is purchasing the London-based startup for a reported sum exceeding $400 million. Update: Sources have now indicated that the acquisition price is $650 million.

The transaction is pending regulatory approvals, with both companies describing negotiations as "early and exclusive." Once finalized, Entrust plans to integrate Onfido’s advanced tools into its broader technology ecosystem, as discussed by Entrust CEO Todd Wilkinson in an interview.

"As we merge Onfido and Entrust, we aim to establish a leadership position throughout the identity lifecycle," Wilkinson explained.

Founded in the 1990s, Entrust (originally part of Datacard from 1969) stands out for adding a robust suite of AI-driven tools through this acquisition. "[With] innovations like Onfido's Atlas AI, it’s clear that AI's potential is a crucial motivation for us," he noted.

While specific financial details remain undisclosed, Wilkinson confirmed that Entrust has been profitable for several years, with annual revenues nearing $1 billion and a client base of approximately 10,000, including government entities and major global banks. Entrust is privately owned by a German family, not subject to regular valuation, hence the lack of public financial disclosures.

Onfido was established in 2012 by Husayn Kassai during his studies at Oxford, later joined by co-founders Eamon Jubbawy and Ruhul Amin. Its trajectory reflects significant trends in technology, particularly the AI boom of the 2010s, attracting investments from notable players like TPG, Salesforce, and Microsoft. The urgency for digital identity verification surged during the COVID-19 pandemic, marked by its last publicly disclosed funding round of $100 million in 2020, although further fundraising has occurred since then, with amounts yet to be revealed.

However, Onfido faced challenges as the post-pandemic economy stabilized, affecting many tech firms. Kassai exited the company several years ago, now focusing on Quench.ai, an edtech AI startup supported by Sequoia and others. Industry whispers suggested Onfido was seeking acquisition for some time, leading to Entrust's strategic purchase at a pivotal moment for technology.

The increasing frequency of data breaches has elevated security concerns for consumers and businesses, while new regulations demand improved identity management. With a surge in cloud-based digital services, the attack surface for cybercriminals has widened, making robust identity verification and security offerings essential.

Entrust, already possessing a diverse range of services and expertise in sensitive markets like government and finance, is poised to enhance its capabilities through this AI acquisition, meeting both current and future challenges.

This trend of combining specialized solutions into comprehensive platforms addresses the confusion many end-users face in an overcrowded market. "There are numerous players in this space, which fosters creativity but complicates decision-making for users," Wilkinson remarked. "Stable companies like ours have capitalized on this situation to thrive over the past year."

We have reached out to Onfido for further comments and will provide updates. For now, we have a statement from Mike Tuchen, Onfido’s CEO: "We are thrilled to engage in exclusive discussions with Entrust to broaden access to advanced and secure digital identity verification solutions globally. Digital identities are transforming simplicity and accessibility for users worldwide. By integrating Onfido's powerful AI-driven verification with Entrust's reputable identity security solutions, we can pave the way for a new era of digital trust."