AI Scams Are Ruining Lives – Now We’re Fighting Back | Ep. 200 with Ricardo Amper CEO of Incode

0:00Hey, everyone. Welcome back to Founder Story. Today, we have Ricardo Amper, the CEO and founder of in code. And this is going to be a very interesting topic today, because it's something that we've been discussing in other episodes, but we never found a company who's really solving this issue. So that's why I'm stoked to have you, Ricardo. But you are reinventing identity verification to power trust worldwide, which is what we need. So before we dive into all those things, because this is going to be so critical. I'd like to understand how did you even get started in this field, in this industry, and why are you solving this problem?

0:41Well, thank you, Daniel. Thank you for inviting me here. It's a long story. I learned entrepreneurship from my dad, and then when I was in college back in 99, it was a long time ago, I wanted internet to be more fun. That was like pre-Facebook. And I started a company called The Bubble. And it was the same concept as Facebook years before that. But I learned a hard lesson, which is that timing is very important because I started late 99, incorporated April 2000 when was the dotcom crashed, raised a little bit of money, and then I couldn't raise more money. And so my first experience was actually that failure that taught me to always be humble.

1:27and how there's a matter of timing and chance in everything that you do. So you need to be able to be incredibly resilient. Then after that, I started a beverage company that I sold to a CPG company, the biggest bread company in the world. And then a turnaround of a personal story where my dad passed away. I had to quit business school, go and do a turnaround of his company that I eventually sold to a big public chemical multinational. And then years after I was able to pursue my passion, which was in technology, and we started in code. But we started with a very different thing. We were, back in 2015, we were sharing photos with facial recognition.

2:17So we had an app that you would take pictures with your friends and they would automatically be shared. or photos that you never shared were shared based on facial recognition, which I think was a terrible idea. But the one thing that was a very good idea was that we built an amazing team of engineers. We were solving things in a way that nobody was doing that, meaning doing AI on the phone before it was a thing. And then we got a little bit lucky. Apple kind of made facial recognition okay. then we pivoted into doing something more interesting which is how do you verify someone's identity by scanning their document and doing biometrics and and eventually it became a big deal when COVID came and banks governments doctors needed to verify people digitally you needed to find a way that was secure and our whole industry took off.

3:18And so we were at the right moment and the right time. So let's go back to these exits. As a founder, as someone who stepped in and became the C-suite, what do you think it takes for a company to get to the viability of when another company would want to acquire it? Well, I think it has to do with the original problem you're solving. It has to be a problem that's interesting enough and a solution that's significantly better.

3:56And honestly, I think founders have an inherent advantage and potentially a disadvantage, which is the lack of knowledge. So when you go to an industry and you understand and you see something that should exist but doesn't exist, it's much easier to see it if you don't have that context. And I think in my life, both when I did the social network, the beverage company, or Encode, it was exactly the same. For example, in Encode, people thought that it was impossible for AI to be better at understanding whether a document is doctored, whether you're you, whether you're actually live streaming and it's not a deep fake because everybody thought that having a human review and get is better.

4:42And to me, it didn't make sense. And we just went and used our skills that we're doing, you know, the photo sharing app and we ended up solving it. With the beverage company, I thought powder beverages back in Latin America were not very good. And all of a sudden you drank something that you couldn't even figure out that was a powder beverage. And so I think that's a benefit of having zero context. I'm curious about the timing. So we've heard this from billionaires, from super successful people like yourself, that timing could be the most important thing to the success of their organization. So I'm curious when the timing of Encode, I know you had a certain problem you're solving and now it's transformed into what it is today.

5:27did the explosion of chat gbt and all you know image creation apps and obviously deep fake of where it's at right now did all these things the last few years really exponentially create momentum for encode absolutely i think as i learned i was as it was impossible to succeed back when the thought come bursted, right? Even if we had a good idea, you know, timing is a defining feature, but you don't control it. It's luck or blessing. And what you control is two things. The first thing is you need to be solving a problem that's important and that hasn't been solved. And the second thing is you have to have an amazing team.

6:16And so those two things, I think you control. And if you're persevering now, maybe you're lucky to be in those things. And so we had, I think, three things to change our company. Apple doing facial recognition, everybody feeling comfortable with that. Number two, COVID and digitalizing. And the three is the Gen AI revolution that is making our industry much more important. And we don't control it, but at least what you control is the two things that I mentioned. I've heard a scenario where a C-suite got a phone call and then transferred a large sum of money to what they thought was another C-suite, but it turns out it was deep fake.

6:56And I, you know, that's just obviously one of, I'm sure, many sad opportunities that are coming up because of AI and people take advantage of that. So how important is it what you're doing at ENCODE? I mean, that's a real story. And the interesting thing is it happened a year and a half ago to us where our treasurer was almost tricked to sending money to fund the escrow account for an M &A. And it was very credible. And then we started seeing a lot of our customers being attacked with deepfakes. You saw in the news how MGM and Caesars were shut down for two weeks because someone successfully, through a deep fake, pretended to be a system admin and they took control of the whole Vegas for two weeks.

7:43And so certainly it's a big problem. And yesterday in CNBC, there was news about how many interviews, I think they quoted about 40 % of interviews are fraudulent now that you're interviewing someone who is not who you think they are. It's maybe even Chad GPT in the back. And so you can imagine this is a problem that is worth tackling. Well, let's talk more. I know Encode just was called a top company in your field, top visionary, which is incredible award that you were just given. Very few companies received this recognition. So talk to me about what it's like for you as the founder and then your amazing team as you get this recognition because you're solving such a huge problem and you're one of the few.

8:33I mean, it's wonderful. It's great to get that recognition. But I think the best recognition we get is the trust of our customers. Some of our customers are like Citibank, Chime, Amazon. We're one of the few customers who's been used in the national election in the U.S. And we have many others, thousands of customers like that. And what we feel is a huge sense of responsibility because if we do our job well, which is verifying users' identity, we help lower fraud. But most importantly, we help them grow. We help them acquire customers that are real and that are going to do good for their business.

9:13And the second thing is I think there's more of a societal effect. If you think about everything that you do, whether you go out into a buzz, open a bank account, going to a doctor, there's an act of identity underlying. And so if those acts are trustworthy, the rest is trustworthy. There's an incredible example in India. Fifteen years ago, it was one of the lowest trusting societies in the world. Only 8 % of Indians trusted each other to transact. And then they did something great, which is they said, we'll never go into paper IDs. We'll just do a digital biometric system. And in 15 years, it's now the highest trusting society in the world, more than Switzerland and Sweden, certainly more than the U.S.

9:57And it's changing people's lives because now, you know, interest rates go down. You trust voting more, which is something that should happen around the world. You can go to stadiums and feel safer. So it is a big deal. And so we think both the responsibility to our customers, but also the responsibility to our mission, which is what we think is the most important. I mean, trust. Without trust, the world will fall apart, right? Like you said, it's a global place. We do business with people not only from our neighboring cities, but all the way around the world. And if we can't trust who those people are, we can't operate.

10:35I mean, this is to me, I might be sometimes pessimistic with AI, although I am, you know, I love AI and I use it all the time. But I am sometimes fearful if we don't solve these problems in the future. So how do you see, you know, how do you see the future of this going in the next few years? Yeah, it's just going to make everything exponential, the good and the bad. And so the question, as you're saying, is is is what percentage of interactions are trustful. And so as much as it's going to allow everybody to increase their productivity, grow their businesses, all of that, which is great, it's also going to make frusters more prevalent.

11:16You're going to have agentic AI doing things for your behalf, but it's also going to have and it's going to exponentially multiply what frusters do. And the problem is how you're going to authenticate those agents. How are you going to make sure that that's an agent that Daniel commissioned? I would say first, is it an agent or is it Daniel himself? Then if you commission that. And the question is, at the very beginning of saying, yes, I'm Daniel to that agent. The question is, who determined your identity? Who was the what type of instrument you did? And unfortunately, we're having a 2025 technology relying on a piece of paper that was invented 3 ,000 years ago by Egyptians.

12:02So the whole system, as sophisticated as it looks like, it is based on a very old technology that hasn't modernized much. And so our job, our mission is to take that kind of very weak link and take it to the 2025. I would imagine that you'd be inundated with companies that need your help, people that need your help. I mean, just thinking about what you said, where agentic AI, we're going to have these AI agents doing like everything, whether it's business, it's life, could be, you know, the next travel vacation. I mean, it's setting everything up that we're going to do. This is going to be a very interesting time.

12:43When you talk to companies, though, around what you're doing, what is the pulse of how they feel about it? What are they saying? Well, the companies that suffer the most right now are companies that you would imagine from financial services, governments trying to make voting better, all the way to regulated industries like gambling, adult entertainment, social media. Those are the ones that right now they have an existential threat on their business to make sure that they can guarantee that interactions are genuine. But what's interesting is that for the first time, companies that were not in that category, you know, from telcos to energy companies are actually realizing that it only takes a fake person.

13:34It takes a fake interaction to portray as a customer or as an employee to get access to their systems. And it can be a massive event that can destroy the company with reputation. It is actually mind-blowing that that is a reality. And so what we're seeing is everybody's now asking, how can I make sure that my interactions with the world, agentic and human, are genuine? I mean, like you said, it only takes one thing now to go viral on social media, to destroy the stock of a company in one hour. Like things could just spread like wildfire and it takes only one thing. Perception is very hard to create a good perception, in my opinion.

14:26but it's very easy to get a bad perception from people nowadays from what it seems. If a company, when they start working with you, the more we talk, the more I understand how big this problem is. I can see why you're solving it. So when a company starts to work with you, can you walk me through the process of that? Yeah. So when we talk to a company, we tell them that there's three things that we excel at. The first one is we've been doing AI for 10 years. There's a lot of companies that put AI into their business nowadays, but we've been doing that for 10 years, kind of with a conviction that there's certain problems in the world that AI is going to solve them a lot better than what humans can.

15:06The second thing is the most interesting part, which is that there's going to be so much fraud in the next three years that I think the world is going to come together and collaborate. Because it doesn't matter how good your AI is, you have to talk to each other. Governments and private companies have massive amounts of data. You have D &Ds who give you a driver's license. We have the pictures, your information, and you have all these private companies that if only companies talk to each other and would say, hey, look, Daniel, with this type of device, IP, is actually genuine. if just companies talked, this problem would be solved.

15:47And so the second thing we're doing besides doing the AI is we're building a private network, starting with the DNVs and then all the way to the companies and build this massive interconnected network that will eventually make very difficult for crosters to defraud. But in order to get to the level of critical mass needed, unfortunately, it's going to get bad. So the second thing we're doing is all these network and companies generally are very excited about that because it's not only solving their business case. When you realize you need to hire, it's usually already too late. I've been there wasting weeks waiting for decent candidates.

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17:55And unfortunately, the people who are more affected are the people who have the least. because if all of a sudden you have a newer entrance, you know, a young person or an immigrant, for example, who doesn't have a lot of information on the credit bureaus and all of a sudden all these fraud starts, they are the ones that are going to not have access to credits or they're going to have high interest rates. And so in my view, these two things are critical. And the third thing is that you have to have a partner that is innovative and goes with you hand in hand. So I think companies are very excited about participating in this network.

18:36To me, it sounds like what you're saying is we are going into the era of collaboration. We came out of the era of competition, and now we're going into the era of collaboration, which I went from being pessimistic to being very optimistic. So thank you so much. I mean, I'm super appreciative of what you're sharing outside of of what you're working on and outside of of what you've been talking about, looking at the other problems that AI is solving, whether it's in health or wealth or, you know, a variety of things. What are you excited about for the future in terms of what AI could solve? I think there is one of the biggest impact of AI is on on voting and democracy.

19:22I mean, we're seeing now a very interesting time in the world, and you're seeing a lot of voices putting opinions about tariffs. And that's why you have to understand how important it is for people to participate in elections, be able to have trusted methods. And so the thing that I am the most excited is not only that voting is going to be digital, I think, in 10 years all around the world. No more physical, no more paper. But not only that, it's going to get to a granular level where if you very quickly want to understand, hey, what about this topic? Do you want to vote for this specific topic that is a game changer?

20:04You're going to be able to do it at a very fast speed. You're going to be able to do it cheaper than ever. And so I think AI is going to have a massive impact into how we make decisions, whether it's at the school board all the way to how you choose a precedent. And it's going to change the U.S. certainly, but think about other economies and political systems around the world, how much impact that can have. And we have this example where we were hired by the state of Nevada to re-verify votes that were contested. and we were afraid. My board was against all of this. He said, you know, Trump is going to tweet against ENCODE and it's going to become the meeting too, right?

20:49But they knew it was important. We did it anyways. And both secretaries of state, Republican and Democrat, were incredibly happy with the fact that there was a much better technology than paper that would actually instill trust and trust in the process of Nevada. and Nevada determined two elections ago the composition of the House. And so that blows my mind that a company, we're not a unicorn, but we're pretty small on the big state of things and that we could have an impact. Well, I mean, the era of collaboration, like you said, whether it's a bipartisan thing, it's, yeah, I mean, I get to, I have the honor of being able to travel.

21:34And like you said, I get to see how other countries are just getting into this digital state. And, you know, 10 years, we're going to be exponentially digital everywhere. We're just going to open up incredible opportunities, like you had just mentioned, which I'm very excited about. So I'm very appreciative that you're here today because you gave me some very good insights. I've been wondering how people are going to solve this problem. I stay up at night sometimes thinking about this just because, you know, this type of fraud happened to me, unfortunately. And I, you know, I think of like, you know, my parents who are in their 70s, 80s, like our grandparents who are 90s up to 100.

22:16Like, how bad is it going to be for them? And they don't even understand a lot of the technology. So this is going to be incredibly needed for all generations. But Ricardo, if people want to get in touch with you, I'm sure there's tons of companies that need to or people just want to find out more information about you personally. How can they do so? They can send me an email, amper at encode.com. And I'm happy to talk to them or add encode technologies on Twitter. Well, Ricardo, encode, thank you so much for joining us today on Founder's Story. Thank you for inviting me there.