Eric Ly, CEO and co-founder of KarmaCheck, on the VatorNews innovation podcast

On the VatorNews innovation podcast, Steven Loeb speaks to Eric Ly, CEO and co-founder of KarmaCheck, a company looking to make the background check and credentialing process faster, more accurate, and more positive across multiple industries, including healthcare, IT, clerical, and industrial staffing.

Highlights from the call:

1:56 - Ly’s experience at LinkedIn: 20 years ago, the whole concept of getting people online, social networks and such, really wasn't a thing yet. LinkedIn got started as a way to more efficiently bring together candidates and employers and help them to find each other for job opportunities. During that time, Ly became even more passionate about the people business, helping people find their ideal roles, and the core insight around KarmaCheck was really around, now that all of these digital identities are online, how do we know that that information out there about candidates is true, given that more and more of us are relying on this information to make important decisions? 

10:10 - KarmaCheck’s solution: There are a lot of manual processes that get coordinated for background checks in the back office, things like interfacing with the real world, when there are courts that need to have a person go to them to find out if a certain individual has any criminal records, and drug screens, which require the candidate to actually go into a clinic and provide a sample. KarmaCheck has automated a lot of those workflows to speed through those processes and provide a level of consistency around how it gathers and interprets the results, to make that a much more predictable and faster process. It’s also relying more on the intelligent use of data: one of the fundamental principles that KarmaCheck has is not having to check things that have been verified before, especially if they stay true, and there's no way for them to change in the present or in the future. Being able to rely on some of those past results will help the next background check go that much faster.

14:47 - Ensuring accuracy: KarmaCheck has to go very granular in terms of each type of license and each state, and really understand how to keep those verifications up to date. Ultimately, the company is being proactive with the candidate to make those checks before it's needed by the employers. In that way, it can be preemptive in terms of not waiting until the very end when the results are needed to have those results available. There's a lot of technology and innovations in that area that are making the company better than how other providers are doing it.

20:33 - Data sources: KarmaCheck relies on thousands of data sources to bring a background check report together, and that really does speak to some of the complexity and some of the challenges around being able to generate these types of background checks. At the same time, the company is looking at some new sources that can provide data even faster and even more data about candidates that can help make this process. So, it’s constantly adding new sources and looking for newer and faster ways to get that information to help complete that report, but all the while making sure that they’re not sacrificing accuracy or not meeting compliance.

23:35 - AI vs humans: It is really important to have subject domain experts in the company who can really understand not only the language, but the processes that existing industries have to go through, and that's particularly true in healthcare, where there's a lot of nuances and there's a lot of particular reasons why things get done the way they do. KarmaCheck wants to speak the language of its customers: beyond the technology, a lot of customers really appreciate being able to have the support that they need, especially as they’re trying to move their candidates through a background check process, which sometimes does get stuck for various reasons; those are the times where they really would appreciate talking to a person at KarmaCheck.

39:24 - ROI: On the speed side, KarmaCheck has been able to show improvements on the order of two to three times what the time that it takes to typically do a background check. On the cost side, it makes organizations more efficient because a lot of them rely on multiple systems to coordinate this process and, as a result, they're doing a lot of paper passing back and forth between systems, and there's people who are in the loop on those things. KarmaCheck is able to combine a lot of those processes into one system in an automated fashion. In some cases, customers are saving up to 40% of the cost that they would normally have spent on background checks when they switch over to KarmaCheck. The company is also seeing this instance of data reuse, which is the idea that if certain checks don't have to get run, then there's no cost that gets incurred by those checks, and they're able to save additional money in that way as well.