Orem, Utah-based iLumin today is launching its "digital handshake" technology, which will work with digital signatures to complete all the paperwork normally pushed around in offices.
The privately held company said it has raised $20 million in third-round funding from Deutsche Bank Alex Brown and Rock Creek Ventures. And it has signed partnerships with more than 40 technology partners, including Cisco Systems, Microsoft, VeriSign, RSA, Entrust and Baltimore Technologies.
The launch comes as legislation giving digital signatures the same legal validity as pen-and-paper documents passed both houses of Congress in recent weeks. The bill, some two years in the making, is scheduled to go into effect Oct. 1 if signed by President Clinton. Although digital signature legislation has been passed in 46 states, the federal law will give parity across the country for online interstate commerce.
The bill does not define how online transactions will take place, however. While there's a growing number of third parties offering software verifying the authenticity of electronic signatures--including Entrust and VeriSign--iLumin said it has defined a new market that will give life to those digital signatures.
Businesses such as law offices that currently use digital signatures must print digitally signed documents, enter the data into their databases, and obtain and verify various approvals, if needed. The digital handshake software, however, runs in parallel with companies' systems to update databases, receive automated credit approvals, and verify digital signatures without paperwork.
The company is launching a pilot phase of its technology today with more than 40 partners. Such companies as VerticalNet and Neiman Marcus will test the software through applications such as W-4 forms. Though the software has been quietly tested through the Utah court system for the past year and a half, the company said it plans to launch it to the public in late September. It also plans to coordinate the first fully automated home loan application next month with an unnamed partner.
Consumers can then store documents with their digital handshakes on them on their computers or print them for their records.
"We can cut out up to 80 percent of the transaction costs by using digital handshake," said Ben Gould, vice president of marketing for iLumin. "The competitive pressure of the market will drive prices down; that's the Internet way. It's going to be huge for consumers and huge for government."
The technology makes it possible for businesses and government agencies to streamline the processing of agreements such as legal documents, loan and nondisclosure agreements, court filings, government applications, permits, renewals, purchase authorizations, and credit card payments.
"Legislation and market acceptance of digital signatures as legally enforceable opens the door to more complete e-business solutions such as iLumin's," Brent D. Isrealson, chief executive of iLumin, said in a statement.
The company, founded as Intelliquest Technologies in 1996, raised $4 million in 1998 when it reinvented itself as iLumin.