Sitting in a small room in a Chegongmiao hardware accelerator, Hugo Garcia-Cotte leans forward and says March has been a busy month. First Microsoft called, then a French venture fund, then an American fund and then a Chinese fund.
They are all interested in the anti-counterfeit technology developed by Garcia-Cotte’s five-person startup.
Cypheme’s cloud-based method of detecting fakes has the potential to impact everything from medicine safety to China’s GDP.
“We’re the first group to be able to analyze the microstructure of paper with a cellphone,” said 28-year-old Garcia-Cotte. In other words, Cypheme’s technology looks at the unique fingerprint of a piece of paper.
Cypheme scans the paper immediately after it is produced, a smartphone app is later used to take a picture of the paper and the image uploaded to a server in Hong Kong. None of that process is special.
What sets Cypheme apart is the machine learning used to analyze the fingerprint of the paper.
It was a stint in Silicon Valley in 2015 that allowed the startup to get their hands on machine learning technology.
“That technology is available nowhere else in the world,” said Garica-Cotte.
The idea started because Garcia-Cotte wanted to protect the value of his Tsinghua diploma.
“I learned that tons of diplomas are fake, and a lot of people pretend to have master’s degrees from Tsinghua,” said Garcia-Cotte, who graduated in 2012. “I felt that should never happen. That’s toxic for society.”
A phone call to Cypheme co-founder Diana Wang changed the direction of the group.
Wang’s mother was hospitalized after taking counterfeit cold medicine.
“I heard about fake medicine,” said Wang. “But I never thought something like that would happen to my mom.”
“We saw that and we said that we have a war to fight,” said Garcia-Cotte.
China may seem like a strange place for a company working at the forefront of anti-counterfeit technology, but Garcia-Cotte explained China is where the technology is needed the most. Not just for food and medicine safety, but for China’s economy.
In the first half of 2015, Xiaomi reported a slower than expected 33 percent growth rate, a huge drop from the 227 percent growth rate in 2014, according to a South China Morning Post article from July 2015. The same report cited Antutu, a popular Chinese phone benchmarking app, as exposing about 1,147,000 Xiaomi phones as counterfeit.
“Counterfeit goods don’t go into the real economy,” said Garcia-Cotte. “It’s a huge problem for China.”
Beck Salander has been doing business in China for five years and recently opened the Providence Cocktail Bar on Furong Road, Xiasha. The bar stocks over 250 spirits and all of them are genuine — but it’s not easy. Counterfeit alcohol is widespread in Guangdong.
“Counterfeiting adds a great deal of man hours and resources to fighting it,” he said.
Salander said that alcohol companies have turned to QR codes, holograms with matching glass engravings, and even chips embedded in bottles — all much more expensive than the square-meter of paper Cypheme produces for 4 yuan (US$0.61).
By integrating the paper produced and scanned by Cypheme into, for example, a packet of medicine, anyone with an Internet connection can check to see if the package — and the medicine inside — is legitimate. AstraZeneca has already approached the group.
But what stops someone from just copying the paper, like copying a QR code? “You can’t photocopy the microstructure of the paper,” said Garcia-Cotte. “We’re a business, we need to make a living. But if we succeed? We will save lives.”