Four Standout Startups at Finovate Day 2

The second day of FinovateFall -- the speed-dating event in which financial technology vendors have seven minutes each to demonstrate their latest products to bankers -- featured gaming apps, security solutions and mobile banking and brokerage apps.

These four few caught our attention for their timeliness, practicality and vision.

Rippleshot was founded in 2012 with a timely notion: stop data breaches and prevent stolen card information from being used at merchants.

It was not a brand-new idea. Other companies provide fraud analytics for this purpose, including IBM, Guardian Analytics, Nice Actimize, Oracle, SAS and ThreatMetrix. Large banks already use such software to sift through transaction data and identify fraud.

But small banks and credit unions generally do not.

Rippleshot targets those smaller institutions. It collects data from card issuer clients and pores through card transactions to find signs of fraudulent behavior, often by looking at past illicit activity and comparing it to current behavior. One unique aspect of the company's approach is that it zeros in on specific merchant locations to find sources of trouble.

A surprising finding: fraudsters often use the stolen card accounts at the very stores from which the card data was stolen, such as Target and Home Depot, partly because those who purchase credit card information on the black market do not know its origins and such stores are a good place to quickly buy big-ticket items with fake cards.

Reaching critical mass will be pivotal for Rippleshot, as the data will only reveal breaches if there is a lot of it from many sources. The company says it already has one large bank and several credit unions in its customer base.

AnchorID -- The world seems to be full of companies offering multi-factor authentication technology to replace passwords. Anchor ID, a startup launched this year by former Capital One executive David Schropfer, takes a slightly different tack - it aims to act as a registry for digital identities. You sign up at AnchorID, are given a universal ID, and then use that ID instead of a user name and password at all the websites that accept AnchorID (currently there are 10). The company is essentially tokenizing identities the way Visa and MasterCard want to tokenize cardholder credentials.

Other organizations, such as the U.S. Postal Service and Verizon, are also attempting to fill this role of identity clearinghouse. But Schropfer says the world needs an independent entity. "If Verizon does it, then Sprint and AT&T have to do their own," he said. "There's a need for a third party."

Also on the authentication front, EyeLock, a regular at Finovate, showed its iris-based identity device, Myris, which is less than $300. Bringing the price down seems critical to get consumers interested in buying it to protect their website credentials. EyeLock also provides user software that lets the consumer manage the apps and websites he accesses with his eyeball.

Loyal3 demonstrated an app that is old-fashioned in a way -- it lets people easily invest in companies they believe in. "There are 165 million Americans who don't have brokerage accounts, and we think that's wrong," Chief Executive Barry Schneider said. The end user can invest in small increments such as $10 and does not pay any fees; the issuer of the stock pays Loyal3 for the service.

"This is about becoming an owner," Schneider. The idea is, loyal customers become loyal investors and vice versa. The company also hosts device-based initial public offerings, circumnavigating the investment bankers of Wall Street.

Linqto showed its new Personal Banker app, which lets banks add videoconferencing to their mobile banking apps. Branch or call center staff at the other end of the video chat can give extra help to customers struggling with a transaction or feature, or provide financial advice. It is basically an Amazon MayDay button for financial institutions. In the company's demo, it showed a remote call center representative depositing a check for a customer through his phone.

"Customers who interact face to face feel more understood and satisfied," said Dune Thomas, vice president of mobile banking solutions Linqto.

Cisco, AT&T and others offer mobile video conferencing. One thing Linqto does that some others do not is detect the customer's device and network and automatically compress the video stream to an appropriate level for the bandwidth available.