WhileOpenAIthe artificial intelligence giant, has discreetly filed its IPO file, promising one of the largest financial operations in tech, the other flagship project of its boss is taking on water. Tools for Humanitythe company behind the controversial Worldcoin iris scanning project, has confirmed a wave of layoffs in an internal email. The company, valued at $2.5 billion and backed by renowned investors like Andreessen Horowitz and Bain Capital, appears to be marking time.
Why is this ambitious project in difficulty?
On paper, the idea of Tools for Humanity seemed to meet a growing need: distinguish humans from bots on a web saturated by AI. The proposed solution is a silver globe, the Orb, which scans the iris to create a unique digital identitythe World ID. In exchange, participants receive tokens of a house cryptocurrency, Worldcoin. Despite nearly 18 million “verified” people, the initial goal of one billion scans is still very far away, representing less than 2% of target.
L’Orb
The main obstacle remains the monetization. Turning retinal scans into sustainable revenue is turning out to be much more complex than expected. Collecting biometric data, as futuristic as it may seem, is not enough to balance the books. This difficulty in finding a viable economic model weakens a company which employs more than 500 people and must justify a colossal valuation.
What are the other warning signs for the company?
Layoffs are just the visible part of the iceberg. The company has experienced a hemorrhage of talent in key positions in recent months. The director of information security, the legal director, but also several high-level managers have left the ship. Such a ballet of senior executives rarely betrays great internal serenity and raises questions about the culture and management of the company.
At the same time, the regulatory pressure is intensifying all over the world. In France, the CNIL has opened an investigation in 2023 into this collection of biometric data, considered extremely sensitive by the GDPR. Spain suspended data processing, South Korea imposed a fine of more than $800,000and Kenya simply banned the service. Each decision cuts off the project of part of its potential user base while increasing the legal bill.
What future for Worldcoin in the face of the OpenAI priority?
The shadow of OpenAI inevitably hangs over Tools for Humanity. Sam Altmanchairman of the board of directors of the latter, is above all the CEO of the AI flagship. The more OpenAI grows, the more its founder’s attention, capital and energy are logically focused on the most promising entity. The OpenAI IPO will only accentuate this dynamic, leaving Tools for Humanity with the difficult task of prove one’s own viability.
Despite these headwinds, the company is trying to pivot towards a more commercial model. Integrations with services like Tinder, Zoom or DocuSign have been announced to use World ID as an identity verification tool. The challenge is to move from a slightly blurred vision to concrete and paid use cases. But the question remains: will this new strategy be enough to reverse the trend and reassure increasingly skeptical investors?
