When companies need to evaluate potential employees, contractors, or suppliers, they often look to screening services to do the necessary background checks and due diligence. The $118 billion regulatory industry is led by a handful of large providers, many of whom use remote employees to manually research dozens of databases for the critical information on these potential vendors and employees.
This high-touch, low-transparency manual process can lead to costly mistakes.
After spending nearly two decades in the industry, Kristin Stafford and Amy Barbieri co-founded cloud-based platform Vital4 to bring artificial intelligence into the regulatory sector. The goal is to fully automate due diligence and background screenings for global compliance.
“Our technology functions almost as a large search engine that goes out and looks at over 16,000 data sources all over the world,” says Barbieri, CRO at Vital4. “It looks for individuals that are high risk and alerts you to those that may not be good to do business with or hire.”
With Vital4, enterprises can screen and continuously monitor the reputations of employees and third-party contractors for global financial sanctions, watch lists, politically exposed persons (PEP), negative media, and medical compliance.
One of their main products, the PEP, uses artificial intelligence and machine learning to automatically extract data on a particular individual and create a profile on them. If the individual is labeled as a “PEP,” it flags them for a higher risk category.
Barbieri says the PEP product is most-commonly used by those in the financial sector; for example, banks onboarding new account holders.
“It’s a very broad search. Level one includes if they have held public office before and level two and three include family members, friends, and business associates. That’s a daunting process from a manual perspective,” says Barbieri.
Vital4 also offers a global watch list and sanctions that update on a daily basis with most of the world’s watch lists. Individuals on these lists may be flagged for terrorism, white collar crime, sex offenses, criminal activity, money laundering, etc. The platform taps into 4,000 sources to make sure clients get the latest data.
In the same vein, their negative media product uses proprietary keywords to search more than 10,000 media sources. “This can help a company learn about the individual being arrested for a DUI, corruption scandal, or bribery,” says Barbieri.
They also offer a healthcare compliance solution to screen medical professionals for any disciplinary actions on their license.
The Vital4 product differs from a regular background check since it does not require consent from the searched party. While that’s also one of Vital4’s products, Barbieri says that their focus as a company is to “be able to provide an instant search to screen someone as part of due diligence.”
That instant search continues operating even after the company begins doing business with a third party. Vital4 keeps their client updated on any changes to avoid any compliance gaps. The platform integrates with the company’s current system and provides a full audit trail of where Vital4 found their information.
They operate under a subscription model for small-to-mid-sized clients and a transaction model geared toward high-volume customers.
“We were really focused on getting big clients with lots of revenue in the door early on, but very quickly realized there’s a huge gap in the market for smaller businesses that need an affordable solution that offers the same level of compliance,” says Barbieri.
The Atlanta-based startup has been largely bootstrapped, with a recent addition of strategic angel investment to launch in other markets.
As they doubled their revenue to eight digits last year, Vital4 went global with customers in Australia, Europe and Asia, including the top four background screening companies in the world.