KYB Upfront

The Concept

KYB (Know Your Business) is the business equivalent of KYC (Know Your Customer). It involves verifying a company's legal registration, ownership structure, and business legitimacy before allowing them to participate in commercial transactions.

The "upfront" part is the critical design decision: do it at registration, not at the point of purchase.

Why Upfront

Competitor Research

Thierry researched recycling, scrapping, and surplus sites and found that competitors consistently require KYB at registration. The flow:

1. User registers as a buyer
2. Immediately redirected to a third-party KYB service
3. Submit company registration documents, business license, etc.
4. Verification completes (may take hours to days)
5. Only then can the buyer see available product listings

Benefits

• Fast checkout: When a buyer is ready to transact, all documents are already in the system. No friction at deal-closing time.
• Trust signal to mills: Mills know that every buyer on the platform has been verified. This is especially important given the trader opacity problem where traders misrepresent destinations.
• Reduced fraud: Prevents anonymous browsing that could lead to competitive intelligence harvesting without genuine buying intent.
• Clean demand data: Only verified businesses generate demand signals, making the matching algorithm's output more actionable.

Tradeoffs

• Higher registration friction: Some buyers may abandon the registration process. This is acceptable because unverified buyers have low conversion rates anyway.
• Delayed access: Buyers cannot browse immediately. This creates urgency to complete verification.
• Third-party dependency: Requires integration with a KYB verification service.

Current State in the MVP

The MVP (phases 0-13) implemented an onboarding flow (B2B-068) with company information collection for both mills and buyers. However, full third-party KYB verification was not integrated. The onboarding flow collects:

• Mill onboarding: welcome, company form, product form, surplus form, complete (5 steps)
• Buyer onboarding: welcome, company form, preferences (paper types + regions + volume), complete (4 steps)

KYB integration with a third-party service remains a future enhancement, but the principle of upfront verification before listing access was established as a design decision.

Connection to Visibility

KYB pairs with wiki/concepts/dual-visibility-settings to create a trust architecture:

• KYB ensures the buyer is a legitimate business
• Visibility settings ensure the buyer only sees what the mill intends for their market
• Together, they give mills confidence that their surplus will not end up competing with their own primary distribution

Sources

• raw/notes/varsovia-meeting -- competitive research discussion where KYB was analyzed

Related

• wiki/summaries/varsovia-meeting-summary -- full meeting summary
• wiki/concepts/dual-visibility-settings -- complementary trust mechanism
• wiki/concepts/side-trims-and-jumbo-rolls -- why trust matters (trader opacity)
• wiki/concepts/service-as-software-pivot -- KYB enables automated deal closing
• wiki/concepts/phases-0-to-13-recap -- B2B-068 onboarding flow that collects company data