Peter O’Neill, president of findBIOMETRICS, interviews Rich Agostinelli, newly appointed CEO of merged Cross Match and DigitalPersona
In case you missed today’s breaking news, Cross Match has acquired DigitalPersona and appointed a new CEO. That new executive is none other than Rich Agostinelli, current CEO of the purchased DigitalPersona, taking the reins from Michael Kohlsdorf who held the position in the interim while this major decision was being made.
findBIOMETRICS was granted an exclusive interview with Agostinelli to talk about the thinking behind the merger as well as what to expect from what is being referred to as the largest independent provider of biometric identity solutions. What follows is a discussion between Peter O’Neill, president of findBIOMETRICS (fB), and Rich Agostinelli, the newly appointed CEO of the now merged Cross Match and DigitalPersona (CMDP).
fB: Thank you very much for allowing us this opportunity to learn more about this very big industry news, so let’s jump right in! Cross Match acquires DigitalPersona and appoints you, Rich as the new CEO of this global powerhouse. What were the drivers behind this move?
CMDP: Thanks Peter. We are very excited about this combination. What we have done is taken Cross Match, which is arguably the leader in providing biometric enrollment solutions principally to the government markets, and DigitalPersona, which again is arguably the leader in providing authentication solutions to the commercial markets, and placed these two strong brand names together under one umbrella. Combined, we offer solutions to our global customers that now cover all phases of the identity life cycle from enrollment, through deduplication, to authentication. So we are very excited about the potential.
fB: The more I examine this fit which I did last night, the better it seems. Can you review what this merger will mean to the market in general?
CMDP: Yes absolutely. I’ve been in the industry for about a dozen years now and have seen biometrics grow from merely an interesting technology to really a critical component of any effective security system that surrounds logical and physical access control. In my view, with all the industry consolidation, there aren’t any companies that have the experience, entrepreneurial spirit and the capability to innovate in this space – but still have the global reach to be able to effectively deploy those innovative solutions. We think we can be that answer. We have very complementary customers and complementary product lines and a wealth of knowledge – technical knowledge, deployment knowledge etc., to help us drive innovation and bring it to market. To be an effective player in security, our solutions have to evolve and change as the security threats evolve and change. We think we can be that nimble company, but with a global reach of over 300 employees, an extensive network of channel partners and 100’s of millions of users around the world.
fB: Geographically, your combined global footprint has increased dramatically… can you tell us a little bit about that?
CMDP: Yes, about 50% of DigitalPersona’s revenue has been generated from outside of the United States. We are making inroads in Africa, Latin America and other emerging markets and of course 50% of our revenue is with commercial customers in the US. Cross Match has a long and proud history with the US government as well as some foreign governments. By putting these companies together, we expanded Cross Match’s reach into Asia and Europe and we extended DigitalPersona’s reach into government agencies where we have not had much traction in the past or focused on. There are now not many countries in the world that we can’t reach – either directly or through one of our channel partners.
fB: That is a great asset. Also when I was examining the potential, it was interesting to note that the vertical markets that both companies focus on again that is a really nice fit, you have different areas of expertise.
CMDP: That’s correct. DigitalPersona has been in the commercial space and has focused primarily on retail, finance, health care and some government programs mostly in the civil space for voter registration and financial inclusion, whereas Cross Match focuses mostly on government enrollment programs. Cross Match has a multimodal capability where DigitalPersona has focused solely on fingerprint technology in the authentication space. So yes, we have virtually no overlap in our customer base and where we do have overlap, we can now offer those common customers much more content than we were able to in the past. The ability to offer the core Cross Match customers the DigitalPersona suite of authentication products and the ability to offer the core DigitalPersona customers the Cross Match suite of multimodal enrollment products plus some other interesting ideas we have around a multimodal software platform to tie all of those capabilities together, we think is going to be very attractive to our customers.
fB: I think you mentioned the size of the organization, could you visit that again and where will the headquarters be located?
CMDP: Certainly. Together we will have over 300 employees. We don’t generally release financial information, but I can say that each company is strong and growing in its own right. Together we think we will now be the largest independent biometric company in the world. The headquarters for the combined entity will continue to be in Palm Beach Gardens, Florida where Cross Match is currently headquartered. I also want to indicate that the brand names, Cross Match and DigitalPersona are one of our greatest assets and we intend to continue to use both of those brand names going forward.
fB: Thank you that is an important piece of information to note. What are the specifics of the deal? Cross Match is acquiring DigitalPersona correct
CMDP: Yes that is correct. Cross Match, as you know, is sponsored by Francisco Partners which is a very large and well respected private equity firm in the Bay area. Cross Match has acquired 100% of the outstanding shares of DigitalPersona. The legal form of the transaction is a merger where the two companies are merging and will be under a holding company known as Cross Match Holdings.
fB: How will this merger affect current customers and clients?
CMDP: All the news should be good for our current customers and clients. To our customers it will be transparent and we will continue to do business under those brand names and through the same channels and contacts they have known and trusted in the past. The added benefit is that we will be able to provide a broader suite of offerings to our customers.
fB: Rich, we have certainly felt here at findBIOMETRICS that the industry as a whole is going through a rapid growth period. I am sure that with your years of experience in the industry you also probably feel this as well. So the timing of this merger comes at a very opportune time. As the new CEO, are you excited by the growth opportunities in the industry and in particular this new merger?
CMDP: Yes I think the timing is critical Peter. We are coming off a very strong year, both DigitalPersona and Cross Match are well positioned going into this year. We see a lot of opportunities in front of us and believe that in order to capitalize on those opportunities, with the types of products and services that our customers demand; we need to have the size and scale with global reach that a company like ours can now provide. Again, we are at the size where we can provide that global reach but are still an entrepreneurial innovative company with a wealth of experience on the technology and deployment side to be able to capitalize on those opportunities. Those opportunities will continue to be in the core Cross Match government markets as well as the core DigitalPersona retail, financial and health care markets. These markets are growing and we are now very well positioned to capitalize on all of those.
fB: Congratulations on this great news and best of luck in your role as CEO of this new entity.
Again as I looked at the news I was quite impressed by just how well the two companies seem to fit.
Thank you very much for allowing findBIOMETRICS to have this opportunity to report on this breaking news.
CMDP: Thank you Peter. We are very excited and appreciate you taking the time to speak with us today.