Cryptometrics has acquisitions in mind

Thursday, September 1, 2005

TUCKAHOE, N.Y.--Biometrics firm Cryptometrics intends to use $17.5 million in new financing for acquisitions, expanding research and new personnel, a company executive said.
"I anticipate growth and acquisitions in the next two to three quarters," according to David Taffet, chief financial officer and chief operating officer of Cryptometrics.
The new financing, announced July 13, was the company's third round and was raised through a private placement handled by retail brokerage firm J. P. Turner and Co.
The round involved individual investors who remained anonymous, the firm said.
Taffet described the investors as sophisticated and with varied interests--some have a vested interest in the company, while others "are simply excited about what our company is doing and the market we're in."
Some invested "at a significant level," and participated in the company's first two rounds of funding, Taffet said. The current round of funding represents a significant up-tick from previous rounds, said Taffet.
The two previous rounds were for $1 million and $4 million. Asked about the reason for the increase in the dollar amount this round. Taffett said, "It's both a hot market and we are doing solid things in a burgeoning space."
Jack Mallon, managing director at Mallon Associates, said that the $17.5 million may help Cryptometrics emerge as a major player in this market, but that there are a lot of challenges in this segment of the security industry.
While the public sector has accepted biometrics, "the private sector has not fully bought into biometrics yet," he said.
Cryptometrics competes against companies such as Viisage of Billerica, Mass., and Identix of Minnetonka, Minn., for customers in the government, shipping, hotel and the transportation industries.
The company's products use facial recognition and fingerprints to identify people and provide security for issuing passports, border security, aviation security and other access control applications.
Founded in 2000, Cryptometrics acquired BioDentity in March of 2004. The two firms merged and operate under the Cryptometrics name. There are 50 employees who work in Ottawa, Ontario and in the Tuckahoe headquarters. In addition, the company has sales offices in New York City, Washington, D.C., Atlanta and San Diego.