Authentag COO Rob Torti on instilling truth
On Thursday, September 14th, 2017, the San Francisco chapter of the Columbia Venture Community will host CVC’s biggest West Coast event of the year: Columbia Startup Demo Night! We always look forward to this opportunity to meet, mingle and shine the spotlight on innovative startups from the Bay Area. This time, six startups, all with at least one founder who graduated from Columbia, will take the stage to demo their startup and compete for a cash prize in front of a panel of experienced judges.
As we gear up for the event, we’re speaking with all our Demo Night founding teams so that we can share their diverse, inspiring stories with the CVC community.
Rob Torti is a busy man, full of energy and enormous goals. I grabbed a quick phone chat with him just before he left the land of good cell phone reception on his way out to the Black Rock Desert to spend a week at Burning man. Lucky for us, he’ll be back in time for CVC Demo Night to present Authentag, where he serves as Chief Operating Officer.
Rob earned his BA in History at Princeton University and his MBA at Columbia Business School. In his spare time, he’s an energetic event and community builder, contributing to largescale art, festival and music projects.
IM: Logistics software covers a huge spectrum. Can you give us an overview of how your solution works?
RT: Absolutely. Authentag is a supply chain logistics software company. We utilize distributed ledger and AI technologies to track, trace, and secure physical products as they move through global supply chains.
Our initial focus is on the Pharmaceutical and Medical Device industries as the FDA has issued new regulations, and our patented technology will help these manufacturers comply in this changing regulatory environment. One million people die every year from counterfeit medicine and it is estimated that 30% of all medicine sold worldwide is counterfeit…that is, it’s fake. We are working to solve this problem around the world. We launched our MVP and are in beta with a test client as well as over 50 other manufacturers across 400 product lines.
How did the company get started?
The company began as an R&D project for the two founders, Scott [Berg], who is a former naval aviator, and Stuart [Corby, the architect of Authentag’s technical platform].
They have some interesting experiences that led them to starting the company. Scott previously started a company around tracking people, information, and supply chains. And Stuart became good at building systems in order to execute secure, large-scale transactions.
Can you talk more about the problem Authentag solves?
Authentag is a system for tracking and tracing physical items as they move through supply chains. There’s been a huge number of issues with supply chain management, especially pharmaceuticals. The global trillion and a half dollar pharmaceutical industry is currently dealing with what are essentially cartels, moving hundreds of billions of counterfeit pharmaceuticals.
This has huge implications for pharmaceutical companies as well as for consumers and drug safety. The World Health Organization estimates that counterfeit drugs kill a million people each year. There’s no way to move that much product completely off the radar, so what these companies do is they disguise and move their counterfeit product using loopholes within legitimate channels.
Using Big Data, mobile devices, cloud-based architecture, and metadata, Authentag tracks movement of items through those supply chains, looking for irregularities. We’ve also been looking at medical device companies. 90 manufacturers of medical devices have already signed up.
At the highest level, what would you say is your guiding mission?
Our mission is to instill truth.
We want to stand up to people who are trying to screw the system and cheat or endanger other people. We want to find the ways we can have the most impact, super early.
There’s a lot of other places we might transition into. Pharmaceuticals are a really great early vertical for us, but there’s so much more. We’ve looked at dairy — there’s a huge problem with counterfeit baby formula into Asia, leading to toxic products sold as baby formula. Pretty much the worst thing you can imagine!
We want to make it easy and lightweight for manufacturers to implement and make it harder for counterfeiters to cheat!
What’s the biggest challenge you have faced?
Telling the story is challenging. Most people really assume that controls are just already in place. But they aren’t.
The track-and-trace industry has been around for a while and has previously focused on physical tagging. However, this is really not a good way of solving the problem [of counterfeit goods]. The issue is that counterfeiters have access to the same tech as the legitimate manufacturers have. Using Authentag, there’s really only one way to break our system, and if it happened, it would be detected right away. As counterfeiters tried to insert something into the supply chain, it would pop up and be immediately flagged — it wouldn’t have the history that a legitimate product would have. This would have been impossible before things like blockchain were available.
Most of the people you’ll meet at CVC Demo Night are Columbia alums. What was your experience at Columbia like? How did it prepare you for what came later as a startup entrepreneur?
I went to business school because my career trajectory was not where I wanted it. I used the time in business school to gain experience and find out really where my skills lie. I found that I have a real financial brain, which allows me to solve problems quantitatively. I also realized that I have a lot of skills around human resources and people management.
When I was at Columbia, I also took a lot of classes in turnarounds and distressed company management. That ended up being a huge factor in my career. After Columbia, I went into consulting to work with some high profile distressed companies, and that was where I gained essentially all the skills that have been important since then.
I believe you can solve any problem with the right people. You need to ask the right questions, create a safe environment for people to fail, and you get great results when people are not worried and not scared.
That’s a good observation. What other advice do you have for students or young entrepreneurs starting their careers?
My biggest piece of advice is: Develop broad skills and broad interests.
[Berkshire Hathaway partner] Charlie Munger talks a lot about this idea of the expert generalist. A lot of people talk about how you need 10,000 hours in something specific to become an expert. But you can also get 3,000 hours in three things and have slightly shallower expertise in each, but your ability to mix those things will allow you to do a lot.
Develop a high degree of confidence in your ability to solve problems. If you can get good at this, you’ll remove a lot of anxiety and stress from your day to day. When you lower your stress level, you can think a lot more creatively.
I learned a lot from Ralph Biggadike. He was a great professor I had in business school at Columbia. He was a great thought leader, able to manage a room with the questions that he asked. He passed away a few years ago, but he was a legend!
Is there anything else you’d like to share with the CVC West community?
At Authentag, we’re excited. We’ve got successful 2-year trials with the dept of defense and we’ve been 100% successful. The next version of the product will be the full track-and-trace solution. The underlying technology is identical, so we’re pretty confident!
There are a lot of people out there focused on doing a lot of good things. There’s a lot of big problems out there to solve. There are a lot of smart people out there who are not focused on solving truly big problems. My hope that the smart young people will work on the big problems! Things like energy, managing resources, future of currency, future of government…in our lifetime, we’re going to see and be part of some big changes.
Thanks for your insights, Rob! We’ll look forward to your presentation at CVC West Demo Night on September 14!
— Irene Malatesta is a writer, marketer and CVC West board member. You can find her @irenekaoru.