18 Jul Web-based biometric company could shake up security
Montello, Wis. – Fingerprints are the oldest and many believe the most reliable form of biometric identification.
Barring an injury that detracts from the uniqueness of fingerprints, their longstanding use by law enforcement in apprehending and processing criminals, and as a condition of employment or licensing, has made the due diligence process more complete.
In the age of terrorism, the fingerprint biometric will contribute to functions like border control, computer network security, and access to facilities. Driven in part by the federal Department of Homeland Security, biometric solutions are a rapidly growing global market, one that will grow from about $2.2 billion in 2006 to $5.7 billion by 2010, according to the International Biometric Group. An estimated 44 percent of that will be spent on fingerprint systems alone.
A Wisconsin start-up business is hoping to capture a good share of that with the help of a new, Web-based product.
Fahlgreen Solutions, formed in 2005, has developed emaChecks, which it describes as a turnkey product that provides faster transmission of requested fingerprints to improve the search for identity and criminal history.
The company, which has attracted attention with strong showings in the Make Mine A Million program and the Governor’s Business Plan Contest, already has landed a contract with the FBI and also counts Ho-Chunk Nation among its first clients.
Born of frustration
Thus far, some of the company’s potential has been revealed anecdotally. “I’ve had conversations with police officers in Chicago that said, “We need this,” said owner and CEO Susanne Kufahl.
What they think they need is something Kufahl, who has a background in systems engineering and is a former Section Chief with the Wisconsin Department of Justice, developed out frustration.
Kufahl initially developed DOJ’s system for processing civilian fingerprints against its criminal history repository. Her frustration with limited access to the civil system led her to invent emaChecks, which she describes as an “entirely mobile” applicant background checking system.
Employing highly secured, encrypted Internet technology, it uses fingerprint images to identify whether an employee or an applicant has a criminal history. Through a central server, the system can send fingerprints across the Internet to search state or federal criminal history repositories, and it uses the architecture of the Internet to retrieve the results and place them in a web account within 24 hours.
“All the connectivity issues with state and federal repositories have been addressed,” Kufahl said.
There are several competitive advantages of emaChecks: first, it can shave days or weeks off what has been a time-consuming process for civilian access; secondly, it can work with disparate systems, including the FBI-managed AFIS (Automated Fingerprinting Identification System), which holds all fingerprint sets collected in the United States; thirdly, rather than waiting for results in the mail, the underlying architecture ensures that results reach customers where and when they need them.
“It takes hundreds to millions of dollars to have an AFIS system database, and states aren’t just going to hire a new company just to get the Internet technology,” she said. “So I think we have what they need in the middle.”
In addition to product sales, Fahlgreen’s revenue streams will come from recurring transaction searches, annual maintenance fees, and the development of several other products that would build on the momentum generated by emaChecks.
At the moment, Kufahl would rather not identify those new products, but she is quite open about Fahlgreen’s target markets. They include law enforcement agencies at the state and local levels, and organizations that are regulated by the state or federal government to have mandatory background checks.
The company also could benefit from the Adam Walsh Child Protection & Safety Act and the Volunteers for Children Act, which allow qualified organizations with employees who come in contact with children and the disabled elderly to conduct background checks.
School districts and universities also are prospective clients, especially with memories of the Virginia Tech massacre and the continuing tragedy of missing college students in Wisconsin.
According to Kufahl, competitive products either cannot receive results over the Internet or cannot connect with disparate systems, or are otherwise not in a position to rival emaChecks.
Thus far, it has cost about $250,000 to build the base emaChecks system and get established in the market. The company has secured about $100,000 from angel investors, and would like to raise between $300,000 and $500,000 total, according to Roger Orlady, who serves as Fahlgreen’s chief financial officer.
Orlady would feel better about the company’s chances of attracting that amount of capital if the two state organizations associated with funding early-stage, women-owned businesses – the Phenomenelle Angels Fund and the Women Angels of Milwaukee – had not participated in a recent $2 million round of funding for TrafficCast International, a Madison-based provider of digital traffic data.
Nevertheless, Orlady already foresees Kufahl’s exit strategy, which will be made possible by the sustainable advantage of her core product. He predicted that Fahlgreen Solutions will be successful enough in three or four years to become an acquisition target, and because Kufahl has developed an integrated solution that none of her larger competitors has, one of those competitors will buy her company.
“I think we certainly have something that is not matched by anybody in the marketplace,” Orlady said.
In addition to Kufahl and Orlady, employees include information technology veteran Chuck Barkow, who helped develop the software, and business manager Rachael Krueger. Kufahl would like to add one more executive manager to round out the sales and marketing side, and then form an Advisory Board comprised of people in civilian law enforcement and other related industries.
The most immediate focus, however, is the kind of continuing education that only comes with word-of-mouth testimony, face-to-face pitches, and continued web and product development. “It’s our biggest challenge,” Krufahl said. “We have to continue to get the word out that fingerprinting is the best way to check someone’s background.”
• Surgical products company wins Governor’s Business Plan Contest
• Learning from the big boys: With technology, women urged to “go gradual”
• Business plan finalists capture technology
• Research consortium aims to bring security and defense contracts to Wisconsin
• New DMV tool never forgets a face