In anticipation of the Techonomy Detroit conference on September 12, we profiled six tech startups that are driving that city’s re-emergence as a center of innovation.
Detroit has become notorious as a symbol of the decline of American manufacturing, but in recent years its tech start-up scene has been quietly attracting attention and generating renewed optimism. Entrepreneurship accelerator Bizdom offers seed funding to local tech startups. The Silicon Valley innovation incubator TechShop set up a Detroit outpost to give locals access to industrial tools and equipment to build their own products. And investors such as Detroit Venture Partners are financing tech-focused efforts.
One Detroit Venture Partners bet is Are You a Human? The company offers an alternative to CAPTCHAs, those fuzzy letter/number combinations that web shoppers are often required to decipher before buying online. Because automated software tools are increasingly able to bypass CAPTCHAs, and because users are increasingly annoyed by them, Are You a Human? has turned human authentication into a game with its quick, fun PlayThru challenges. This month, the 5 millionth PlayThru game was played. I spoke with Are You a Human? founder Tyler Paxton about his new human verification games and what it’s been like to work with Detroit Venture Partners.
What was your inspiration?
I had the idea a couple of years ago. I was working at a different job and one of my coworkers came in after trying to buy Hannah Montana tickets, allegedly for his daughter. They sold out in seven minutes. We were surprised that there were that many people looking for Hannah Montana tickets. We found out that scalpers would buy the tickets using automated programs to bypass the CAPTCHAs. I started to think about whether there is something better that would stop the bots without making it super difficult for people. We officially launched in January.
What are the flaws in the current CAPTCHA system?
CAPTCHA was invented over a decade ago, and at that time the theory was “Optical Character Recognition can’t read these words, and humans can.” But obviously OCR has caught up, and there really hasn’t been a shift in how we verify people. All they’ve done is try to make the words harder and harder, but that makes it harder and harder for people as well.
Traditional CAPTCHAs are not only hard, but people end up leaving sites because of them. In our testing we see a 40 percent increase in the number of signups that a site might get when they use [our PlayThru games]. Not only are you making something easier for people, but it affects the bottom line by getting those people to do what they originally intended to.
Are PlayThru games easier than CAPTCHA?
A Stanford study looked at the usability of CAPTCHA. They found that one in four CAPTCHAs are failed on the first attempt—that’s a 75 percent pass rate for humans. Our games have close to a 99 percent success rate for people. One in 100 might fail.
Do you partner with companies that want the games on their site?
You can just install the plug-in on our site; it takes about five minutes. Right now the games are free, but we plan to put some branding and sponsorship into them—so you could use the tool for free on your site but you might get some branding in there. Right now if you look on our site you’ll see a game where you put the food in the fridge, and that might become something like putting the Coca Cola bottle in the fridge. And we will be opening it up as well so customers can avoid ads and provide access to different, cooler, more fun games.
Can you tell me a bit about the tech scene in Detroit and what it’s like to start a company there?
The tech scene in Detroit is nascent. We were in Ann Arbor, and all we had was rumblings of a tech scene. All three founders of the company are from the Michigan/Detroit area. We decided we wanted to do something in downtown, and our funders are Detroit Venture Partners. When we first moved down here there were only 10 or so people in the space that we’re in, and it seats about 100. Since February, the space has been packed. Now if you want to be down here and you want to be a tech company, you have to wait for space to open up. It is just great to see that revitalization of the entrepreneur mentality in an area that for a long time leaned on an industry that couldn’t support the area like it did in the past.
What has it been like working with Detroit Venture Partners?
For us it’s been phenomenal. You’ve got guys here who are entrepreneurs themselves running this fund. They’re right there in the building next to us. We can just go over and say, “Hey, this is what I’m facing.” They not only have ideas and things that they’ve heard about, but also stuff that they’ve actually done and they can talk about. Also, being in Detroit, and it being kind of a new scene, it’s great to rely on those guys to put us in touch with the companies and connections in the area. While in another city we might just be another small fish in a very big sea, here we feel we are part of something bigger, and it’s easier for us to talk to companies here because we are one of the few startups.
For complete coverage of the September 12, 2012, Techonomy Detroit conference, click here.