Ed Zabar’s company, Verif-y, uses blockchain in its technology, but Verif-y doesn’t bill itself as a blockchain company. When he describes what his company does, Zabar talks about how Verif-y can help verify credentials of important personnel, secure private information, and comply with rigorous privacy standards such as the European Union’s General Data Protection Regulation and the California Consumer Privacy Act.
“There are blockchain-centric companies,” Zabar says. “We are not blockchain centric. Blockchain, for us, is a layer within our technology stack. What it does is it allows us to serve clients in a better way.”
Zabar is the guest speaker at the next meeting of the Blockchain Princeton group, scheduled for Thursday, February 27, from 6:30 to 8:30 p.m. at Tigerlabs. For more information, visit www.meetup.com/Blockchain-Princeton. Verif-y, based in Philadelphia, is online at www.verif-y.com.
Verif-y is out to provide a solution to problems of user onboarding and the new rules that organizations have to follow when dealing with sensitive information. Zabar believes there is a massive market for this service, especially in the healthcare industry. On the surface, the service that Verif-y provides is simple: it allows users to upload credentials, have them authenticated, and then authorize employers or business partners to check them. (There are already “credential bank” services that do this.) Where it gets complicated is behind the scenes, in making sure the data is secure and accurate.
Zabar says he got the idea for the company earlier in his career when he was working at an investment bank. “We had a client selling this company, and he essentially forged his credentials,” Zabar says. “Because he forged his credentials, the deal fell through. We had tried to validate the information using the archaic methods of background check companies.”
Zabar says blockchain technology has helped him build a service that allows the user to control who has access to the data and exponentially increase its accuracy. But before the blockchain means anything, the validity of the credentials has to be verified in the first place. Zabar says his company checks the sources of documents directly. For example, if a reporter claimed to have been chief editor at the New York Times, Verif-y would contact the Times directly and check if they really had worked there. If the user is lying, they get a literal red flag in their records. Too many red flags, and the user’s abilities to share information are restricted.
Shifting control of the information to the individuals whose data is being stored is intended to relieve organizations of the burden of handling information.
The company was founded in 2016 and now employs about 20 people in its Philadelphia office, with 10 others working remotely. Unlike some other blockchain startups, Verif-y has reached the point of having an actual product to offer and real clients buying it. Zabar says he can’t identify the clients yet, but he has Fortune 500 companies ready to start using his product.
“We are starting to work with really large organizations,” he says. “We have been spending the last six months enabling the system to scale better to be more accurate and to be more dynamic at the enterprise level. We are serving some clients right now and we expect some of the larger clients to come in the next few weeks and months.”
Zabar understands the skepticism about blockchain technology. Although based on an older idea, the world’s introduction to blockchain came with Bitcoin, the controversial cryptocurrency that has experienced wide fluctuations in value (and little use as an actual currency of exchange) since its debut in 2008.
Blockchain technology is a system of recordkeeping in which new records are connected to previous ones using cryptography, and stored in multiple different places. Records stored in blockchains are resistant to tampering because a record cannot be changed without leaving a permanent record of the change.
In the early days of blockchain hype, many startup companies launched touting the benefits of blockchains, but few have put them into action meaningful to businesses. Zabar says the hype, and subsequent disappointment, made many wary of blockchain technology. He says many companies tried to use it in applications where it was not appropriate.
That is partly why he is not emphasizing it heavily. Despite the hype and fallout, he believes the technology has its place and has just needed time to mature. He said companies have only been working on non-cryptocurrency applications for the last four or five years. “Any financial technology, from electronic money transfers to ATMs to anything else, if it’s a very disruptive force, it takes time to implement,” he says, especially in large, highly regulated organizations.
He adds that Verif-y is not a blockchain company. “We can do 80 percent of what we do without blockchain, but with it, it’s better, faster, and more secure,” he says. “The important thing is to demystify some of this blockchain stuff and some of the negative connotations of it. It’s advanced database technology first and foremost, and if used properly, it can solve things in a novel way.”
For Verif-y, the key advantage of blockchain is the immutability of records. “You can’t just delete a record once it’s been validated,” he says. “That record cannot be changed just because someone wants to change it or hack it. A derivative of that fact is that auditors can have immutable ledgers that detail the steps taken to validate a record. It makes the compliance and screening process much more accurate and trustworthy than it was before.”
Zabar grew up in Israel and served in the Israeli Defense Forces before moving to the U.S. 25 years ago. He says he worked with a government entity and studied at NYU, majoring in finance and IT. He worked on Wall Street and founded two startup companies. Later he earned an MBA at Columbia, worked for an investment bank, and served as a turnaround CEO for Switch Concepts, a British company. He moved to Philadelphia and founded Verif-y in 2016.
He says Verif-y is different from other credential banking companies because it aggregates services that some of the others provide: blockchain-based secure storage, privacy regulation compliance, and credential scanning and validation.