PARIS -- French startup Cypheme has combined unique tabs with artificial intelligence software to authenticate products and defeat counterfeiting, a problem with global reach but coming mostly from Asia.
Cypheme markets its technology to a range of industries such as textiles, pharmaceuticals and finance, where fake items can harm both producers and consumers. The company calls Paris home, but its business stretches to mainland China, Japan, Thailand and Taiwan.
Cypheme's small tabs can be affixed to genuine products either as a sticker or printed directly on the label or packaging. A triple layer of security prevents the tab from being copied, the startup said.
Brands can affix Cypheme's tabs to virtually any product. The most obvious are luxury brands of clothing, cosmetics and jewelry, but even wine, electronics, medicine and autoparts can fall victim to counterfeiting. Cypheme has contracts with garment, wine and electronics companies.
The company initially generates a "noise print" by drying a special type of ink in a random pattern at the center of the tab, creating a unique chemical signature.
"The pattern is formed randomly, so we couldn't reproduce it even if we wanted to," Gilles Bonnabeau, Cypheme's Europe director, told the Nikkei Asian Review in a recent interview.
The noise print is then surrounded by a circle 1 cm in diameter printed in Cypheme's own orange ink. This particular shade of orange cannot be imitated by inks used in commercial or industrial printers, the company says.
"We're the only ones with the original recipe," Bonnabeau said. Cypheme designed artificial intelligence software that can recognize this specific shade.
Finally, each unique tab is uploaded to a database and linked to a specific product.
"Even if the tab is an original, if it's not in the database, the product will be considered a fake," Bonnabeau said as he demonstrated how the system works with his phone.
To check a product's authenticity, the consumer snaps a picture of the Cypheme tab and sends the photo to the brand's account on a messaging app such as China's WeChat or Line. In less than 10 seconds, the consumer receives a reply: authentic or fake.
"Before, products were authenticated by complex machines only used by border control or investigators," Bonnabeau said. "Now, any consumer with a smartphone can check if a product is genuine or not."
The service also should be available via Facebook in the near future.
The French company offers a cheaper version of its tab without the noise print to be used on products such as food, which are produced in large volumes and have smaller margins.
Bonnabeau wouldn't disclose the cost to use the tab, but called the price impact on the final product negligible.
More than 85% of the world's counterfeit products come from mainland China and Hong Kong, a haul worth $396.5 billion, a Europol report published in 2017 says. Beyond the commercial impact, counterfeiting costs countries in job losses, fiscal shortfalls and criminal enforcement. Counterfeiting also harms a brand's image.
Some counterfeit products, particularly medicines, can impact health and even be deadly. Falsified antimalarial medicine kills over 100,000 people yearly in sub-Saharan Africa, according to a model by the London School of Hygiene and Tropical Medicine. The World Health Organization says falsified antibiotics also are responsible for tens of thousands of deaths annually.
Cypheme was founded by two young French computer programmers who sought a solution to counterfeiting after a loved one took a fake drug. Since 2017, they have been working from Station F, a Parisian hub for startups.