It started with the frustration that TransCrypts CEO and co-founder Zain Zaidi and Ali Zaheer, the company’s CTO and co-founder had when trying to access their academic records.

Both found the process was so antiquated, slow and open to fraud, Zaidi came to believe there had to be a better way for people to have full ownership of their identity and credentials.

“We started TransCrypts because we discovered that as individuals, we don’t own any part of our verified identity credentials,” he said in an interview with TechNX.

“My co-founder graduated from the University of Toronto and he found that if someone wants to verify that he is a graduate from that university, he would need to go to the university and pay a fee to get an official transcript to verify his academic status, his grades, or his graduation status. The university is ultimately the one who controls that information. That is a relic of the 19th and 20th centuries.”

Zaidi and Zaheer started the company in 2020, and shortly after began working with The Hub, the U of T Scarborough’s entrepreneurial incubator, to develop the blockchain technology that allows employment records and other records to be broken up and encrypted, thereby making them more secure and preventing alteration of those records.

They soon secured early funding from both The Hub and U of T Entrepreneurship program, with $5,000 and $10,000 respectively won in start-up competitions they entered at both.

Giving identity protection back to people

In 2023, they managed to get US$2.4 million in funding from backers, including Shark Tank investor Mark Cuban. Last year, TransCrypts raised a $15-million seed round led by Pantera Capital with participation from Lightspeed Faction, Alpha Edison, Motley Fool Ventures, California Innovation Fund, Gusto cofounder Tomer London, as well as existing investors Mark Cuban, Techstars, Alumni Ventures, Protocol Labs, Apertu Capital, Informed Ventures, Asymmetry Ventures, and The Atland Fund.

Zaidi explained TransCrypts can be integrated into a firm’s HR and payroll systems giving control of who can see or share those records to current or former employees.

“Now an employee can consent to share records to allow for background checks by new employers or banks,” Zaidi said. “You also don’t have to verify if the information has been dually sourced as the employee has to consent to sharing it with you.”

Zaidi said the company has several large firms with tens of thousands of employees who now use TransCrypts to handle the often hundreds daily reference requests and checks on current and former employees, freeing up staff that once had to be tasked to manually handle those requests.

Because TransCrypts lets people control their information, and blockchain technology and end-to-end encryption adds a high level of security around the information, employees and employers have welcomed this solution, Zaidi added.

“Obviously individuals love this as they now control the information, which is becoming increasingly important in this time of AI driven fraud,” Zaidi added. “Because we have created this decentralized architecture, even if a bad actor were to access us, they would not be able to access any records, as those records live with the employee.”

Zaidi said the new funding they received is now letting them expand beyond employment credentials into health and educational records, and possibly in the near future creating a “consumer empowered credit bureau” based around the blockchain solution TransCrypts has developed.

“We’re all familiar with a credit bureau, but it is just a third-party, an entity that determines a big chunk of our life,” he added. “Employers will run your credit score before they make a hiring decision, landlords will run a credit score check before they lease a place to you.

"We think we have the potential to create a much more fair, more efficient and more consumer-friendly version of a credit bureau as you will own the information and make decisions as to who can access that information instead of relying on some arbitrary credit score based from a credit bureau made based on information that you cannot have access or see.”