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An Austrian startup that has built encryption software to share private data without decrypting it has raised $5.5 million in seed funding from investors including A16z and Archetype VC.
Taceo, founded in 2022, has created software that lets companies verify or compute information without decrypting it. That could help payment providers verify transactions or hospitals collaborate on clinical trials without sharing patient data, the startup said.
“They can run the algorithms on our encrypted data without prying on us, but still delivering the service that we find so useful,” Lukas Helminger, the cofounder and CEO, told Business Insider.
The startup has combined two encryption techniques to create a cryptographic tool called coSNARKs. Its code is open source, Helminger said, but runs on a cryptographic network that it plans to charge customers a usage-based fee or, in some cases, a flat rate to access.
In 2022, Taceo built the encryption software for World, Sam Altman’s iris-scanning verification startup. The partnership came about after the team met representatives for World, then called WorldCoin, at a blockchain conference at Stanford University.
Taceo’s software is encrypting the biometric data of over 14 million people using World, which uses eyeball-scanning orbs to prove people’s identity.
“This is like a mix between Silicon Valley and German engineering,” Helminger told BI, adding that Taceo gets some revenue from the partnership with World.
Helminger told BI that the startup plans to use the fresh capital to grow its team from 12 to between 18 and 20 people, and double down on R&D to address the computational challenges associated with encrypting information for AI.
Over the next six to 12 months, Taceo will target customers in financial services, Helminger said.
The startup’s longer-term bet is to deploy its technology for AI use cases, which Helminger called “one of the toughest nuts to crack because it’s so computation-heavy.”
Archetype VC led Taceo’s $5.5 million seed round. The startup also received funding from A16z CSX, the investment firm’s crypto startup accelerator, along with Cyber.Fund, a_capital, and Polymorphic Capital.
Here’s the 19-page pitch deck Taceo used.
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