Selfies are no longer just a social media irritant: With Mastercard’s Identity Check, your face is the latest form of biometric identification. In October, Mastercard rolled out the new mobile-payment ID feature, which allows e-commerce customers to verify themselves at checkout simply by capturing an image of their face on their phone. “One of the biggest consumer pain points is when you are prompted for a password,” says Ajay Bhalla, who oversees Mastercard’s security efforts. “That leads to a lot of friction: unhappy consumers, merchants losing sales, banks losing volume.”
Two years in the making, Identity Check works much like the iPhone’s fingerprint ID system. Users set it up in advance by taking a series of photos from several different angles. That info is then turned into an algorithm, which Identity Check can match to a fresh picture at the moment of transaction. “Biometrics is actually safer [than a password] because it is really you,” says Bhalla.
Shoppers weary of passwords might be excited to hear the news, but they should be careful not to get too happy. “The biggest issue we face is that people naturally start smiling when they take a picture,” says Bhalla, “and that messes with the algorithm.”
Mastercard is also exploring other new methods for identifying customers, such as iris scanning, voice recognition, and even heartbeat monitoring. Blood-pumping patterns, it turns out, are as unique as fingerprints. —Nikita Richardson
Milestones: In September, Mastercard launched a program to help developers integrate their services into new technologies such as virtual reality, augmented reality, and the internet of things.
Challenges: Mastercard has been hit with a $19 billion class-action lawsuit over allegations that the company charged illegal fees to U.K. vendors, leading to higher prices for consumers. (“[We] firmly disagree with the basis of this claim and we intend to oppose it,” says a Mastercard spokesperson.)
Launched in 2013, ClassPass lets exercisers pay a subscription fee for convenient and economical access to classes. The company has grown fast—it’s now in 36 markets—but is still working to find a sustainable business model. In the past two years, it’s raised the price of its signature unlimited pass from $99 a month to $125 and now $190.
Founder and CEO Payal Kadakia’s concept is to make use of underutilized time slots; ClassPass pays a discounted rate to the fitness studio. That means the company has to nail a pricing structure that pleases both customers and providers (while taking a cut for itself). Because ClassPass pays per class, the more customers use it, the less it makes. Subscribers tend to use passes more over time, which makes the long-term economics tricky. That’s one reason Kadakia is thinking about killing the unlimited option—sure to be an unpopular move. (There are also $65 five-class and $125 10-class options.)
Still, Kadakia is optimistic. The company is considering expanding the subscription concept into other areas such as massages, tennis, and even movie tickets. And despite the price increases, most users still seem to love the service. “It’s about the product we built and the experience and the technology,” says Kadakia. “I mean, people go to classes. That’s the most amazing reason the company has done well. It’s proof that the product is working.” —Ruth Reader
Milestones: ClassPass hired its first CMO and CTO this year.
Challenges: Price increases have cost the company 10% of its users, Kadakia has acknowledged.
Milestones: The Chinese ride-hailing business—which is now valued at $34 billion and received a $1 billion buy-in from Apple in May—is expanding into bikes, making an estimated eight-figure investment in Beijing-based two-wheel-rental startup Ofo.
Challenges: With Didi’s purchase of Uber’s China operation close to completion, customers and drivers will feel the pinch if it raises prices and lowers payouts in a bid for profitability.
BLUE BOTTLE COFFEE
Milestones: The high-end java outfit’s latest foray into consumer products is Perfectly Ground, a collection of single-use coffee packets that will be sold at Blue Bottle cafés and Whole Foods. The company, which has raised $100 million from investors and operates 27 cafés in the U.S. and Japan, recently announced an expansion into Boston, Washington, D.C., and Miami.
Challenges: In 2015, Blue Bottle’s planned merger with San Francisco’s Tartine Bakery fell apart. Now Tartine is rolling out its own competing brand of artisan coffees.
Milestones: A U.S. International Trade Commission judge cleared the company of wrongdoing in a case brought by rival wearables maker Jawbone that accused Fitbit of stealing trade secrets.
Challenges: Fitbit’s new Charge 2 device is reportedly not selling as well as analysts expected.
Milestones: Discrimination has been an ongoing issue for the platform, so Airbnb recently adopted a policy designed to combat bias based on race, gender, and other factors. Hosts must now sign an antidiscrimination agreement, and the company is working to expand Instant Booking, which helps prevent bias in the host-approval process. It has also hired an antidiscrimination team to monitor possible issues.
Challenges: The company hit a major regulatory snag in October, when New York governor Andrew Cuomo signed a law making it illegal to rent out apartments for less than 30 days at a time. Airbnb quickly filed a suit to block the law, which it says is unconstitutional.
Milestones: The U.K.-based architecture firm has been commissioned to build a $150 million staircase sculpture, dubbed Vessel, for New York’s massive Hudson Yards development. Construction is set to begin in 2017.
Challenges: The future of the studio’s Garden Bridge project in London is somewhat cloudy due to intense public scrutiny following extensive delays and cost overruns.
Milestones: As the mall staple struggles to regain momentum after several years of revenue slips, it is experimenting with offering its clothes at outside retailers such as Nordstrom and Net-a-Porter—a first for the 33-year-old brand.
Challenges: Financial woes continue to plague J.Crew. It recently reported a decrease in same-store sales for the eighth straight quarter.
OCEAN RENEWABLE POWER COMPANY
Milestones: The Maine-based energy provider announced that it has secured a $5.35 million grant from the federal government to complete development on its TidGen Power System, which uses waves to generate electricity.
Challenges: In addition to the federal grant, Ocean Renewable will need to raise a similar amount of private capital in order to commercialize the new power system.
Milestones: The fast-growing workplace-communication platform has attracted 4 million daily active users, up from 3 million in May. The company recently announced it is integrating Salesforce, a big upgrade in functionality.
Challenges: Microsoft and Facebook are both planning to release their own competing work-related messaging platforms—Microsoft Teams and Workplace—before the end of the year.
Article and Photo by: Nikita Richardson & Ruth Reader | Fast Company