It's About You
From Bankruptcy to $3B Identity Platform
Disclosure: Not financial advice. Do your own research.
Recently, we published a post about a really neat company growing 25%, high ROIC, solid cash flows, with future operating leverage potential.
This business is misinterpreted by the street as a traditional, sleepy company. But when you pull back the curtain, it has a technology engine underpinning the core brands, gathering data and providing informed decisions. It’s multiple brands and technology arms all wrapped into one neat company. It’s an empire with a technology platform. And Management has launched two highly successful brands using their technology platform, by solving critical problems for customers.
Now, the reason why we’re mentioning this is the founders bought the original brand out of receivership way back in 2013, and are the current owner-operators of the business. We like that. It wasn’t a turnaround story or a disastrous situation like Lululemon with their awful now former CEO Calvin McDonald.
No, this story was about a brother-sister combo that took the business from bankruptcy to a multi-billion dollar empire in the span of a decade. Not very many people can say that.
Today, we catch up on a similar story. It’s a different company, but it too has grown into a multi-billion dollar business in the span of a decade and has an owner-operator-founder who bought the initial brand out of bankruptcy. Let’s dive in.
It’s about YOU 0.00%↑ — Clear Secure.
Clear Secure was originally founded all the way back in 2003. This was just after the Twin Towers collapsed at the end of 2001 — 9/11. Cofounders Steven Brill and Ajay Amlani founded Clear Secure as an identity technology firm. It was a response to Congress standing up TSA. They wanted public-private partnerships and Clear Secure was created for that purpose. And by many measures they were successful. The duo managed to get into 16 airports, raising around a hundred million dollars of capital with some debt. Since Congress gave Steven a license to register people as part of the Registered Travelers program, he worked on a smart card for those registered travelers. In fact, they actually had 190,000 customers.
But two or three things happened. The economic downturn in 2008 significantly cut business travel. Debt was further coming due in 2009. That was in the midst of other companies having debt piles too. Ultimately no-one could pay the bills. Gradually, the founders left. First Ajay Amlani in 2006, and then Steven in 2008. By 2009, the company went bankrupt.
Separately, in another walk of life, way before Clear Secure was even a thought in the original founder’s brains, Caryn Seidman-Becker was working her way up Wall Street. She went from risk arbitrage in 1994 to asset management and the buy side with hedge funds through the 90s. As you can imagine, she’s dealt with and personally invested in a broad swath of companies throughout that part of her career. By the early 2000s rolled around Caryn was ready to go out on her own and she co-founded Arience Capital, where she invested in Apple, Amazon, and Priceline in 2002.
What Caryn saw first hand was products turning into platforms. From Apple’s clunky personal computers to Amazon’s books, each transformed beyond their individual initial products. And at the helm of each, was an “unconventional” leader who engaged with the customer.
By 2009, Clear Secure’s bankruptcy came across Caryn’s desk. But she already knew about identity and biometrics. Back in the early 90s, was the era of mergers and acquisitions in the Aerospace and Defense industries. A big part of those companies already dealt with identity. Also in the 90s, Caryn and her team invested in wireless and satellite subscription based businesses. That’s where she really learned about the power of subscription based businesses. By the 2000s, Caryn was seeing the “consumerization” of biometrics outside of the U.S. from voting systems in Brazil to financial services in Asia. Her whole journey led her to this intersection with Clear Secure.
In 2008, Arience Capital — Caryn’s firm — went fully into cash. She assessed her situation with three young kids and decided she didn’t want to do solely passive investing anymore. At the time her husband was at Apollo (private equity), and they were taking over companies, rolling up businesses and Caryn started to like the sound of that. Building something of lasting value to make the world a better place.
As most people, 9/11 had made a lasting impact on her. When she found Clear Secure, it really spoke to her, making the country safer, making consumer’s lives easier. It was biometrics and a subscription-based business which she already believed in. So Caryn, her husband, some advisors, and her co-founder went into a room in a law office to bid against a group of former employees from Clear. As Caryn likes to say, “bankruptcy is decided at the courthouse steps.” And so they ended up bidding $6 million dollars below the other bid, but with one key factor — the most important part. It was an all-cash offer. And the cash would be delivered that night. As you may have guessed, they won.
Caryn and her partner Ken Cornick became founders.
So now the duo and the initial team they scraped together were standing in front of a $6 million dollar purchase. What did they do?
Number one was inventory. For $6 million, they bought a what some people considered “sullied” brand, and $10 million worth of PPE — of hardware. Where was the hardware, the devices? What makes up Clear Secure? So they went to the San Francisco and other airports and dug through storage units to find their tech.
Number two was rebuilding the software from the ground up, since the previous Clear Secure didn’t own their software.
Number three was getting a first location, which they pitched and won Orlando Airport. Then, they had to tell their customers that Clear was returning to the Orlando Airport. But people were resistant, and many protested. Caryn didn’t just buy the founder-owner-operator title. She had to go to Orlando, build up training programs, talk to customers. Eventually they launched at 4:30 am in the Orlando Airport, and many customers were excited. Caryn talks about how many people even came up and hugged her.
They quickly came to realize the 400 or so airports followed the Pareto Principle - or the rule of 80/20. That is, 80% of airport traffic flows through 20% of the airports. Further, the new Clear Secure team learned that airports are a complex ecosystem with many players involved - from fire departments to local police to municipal employees, federal employees, airline employees, TSA employees, custom CBP. Needless to say, airport operations become quite complex.
But Caryn and her team maintained the view that Clear Secure acts as a force multiplier. Increasing airport throughput and enhancing security. And it’s needed. In 2025, there are around 3 million people a day going through airports in the United States. By 2030, that’s expected to reach 4 million people a day. You can’t bring all these people through the front door, in one path. Clear Secure is leveraging technology to open other doors, using automation to resolve staffing issues, and a whole host of other innovations.
Over the years, Clear Secure and Caryn have faced their share of challenges. Especially during the Biden Administration, Caryn says that the government put policies in place that really made it difficult for Clear Secure to improve throughput. For example, they introduced the physical escort policy, forcing Clear Secure ambassadors to stand with people. Which, if you’ve used Clear, you know that it’s really — put bluntly — dumb. Further, recheck policies were put in place to force documents to be rechecked by TSA. Fortunately, those difficulties peaked and have now abated, with the new administration maintaining a much more friendly posture towards private businesses like Clear Secure.
The key to Clear Secure after Caryn took over is really a switch from pessimism to optimism. The company was born into strict, harsh regulations that beared down on travel. But under Caryn the company shifted direction. Clear Secure is about increasing travel, making it easier to travel, using automation and technology to reduce customer friction. She likens Clear Secure now to Airbnb, in that it’s purpose is to make travel more accessible and fun and easy. Not be the big bad watchdog in the room that invades your privacy.
As Caryn discusses, Clear is vertically integrated like American Express. With Amex, if you lose your card, the statement goes right through to the new card. But Clear isn’t a card company, it’s a vertically integrated identity platform. Users are at the center of the platform, where the vertical integration includes: enrollment, verification, apis and sdks for partners, real estate in airports, ambassadors at airports, the hardware and software is owned by Clear Secure. They bring the members to the partners.
So we’ve got a bit of qualitative background, but what’s the business? How does Clear make money?
Caryn knew the subscription model. And she knew that outsourcing the people would cut down on the margins, that owning the tech would let them adapt faster. So, Clear Secure became a subscription business. But it didn’t happen overnight. Caryn went without a salary for 5 years. The company burned $53 million of cash to reach profitability in 2017, a span of 6 and a half years since the company launched.
The team was incredibly cheap and scrappy. Ambassadors were incentivized by Clear to sign up new customers inside airports, keeping marketing expenses razor thin.
It payed off. In 2021, Clear Secure IPO’d on the NYSE under the ticker YOU 0.00%↑.
The share price was $31 at the IPO, and Clear Secure raised $410 million by going public. As of January 30, 2026, Clear Secure shares trade at $32.60. Effectively, they trade at their IPO price. Over 5 years, Mr. Market has driven their price up and down but wound up in the same place.
Meanwhile, in 2001, Clear Secure had $254 million in revenue with negative net income of ($36) million. In 2025, Clear Secure has done $866 million in revenue with $182 million in net income on a TTM basis. It’s a $3.22 billion market cap company, with an enterprise value of $2.8 billion, and yet, it grows top-line at 16%, an ROIC of 92% (!!), and a free cash flow yield of 9%. In 2026, Mr. Market hates growth, but it looks like he also hates ballooning free cash flows!
Clear Secure even issues a 1.52% dividend, and has bought back a lot of stock since going public, from a peak of 155,000 shares outstanding to 133,000 according to Caryn.
Despite Caryn having pulled off the adjacent impossible, taking a sullied brand and business from bankruptcy to multi-billion dollar monopoly, Mr. Market doesn’t like it. Maybe Mr. Market thinks growth will fall off a cliff, or that Clear Secure will get replaced by chatgpt.com, who knows.
Meanwhile, 6 analysts forecast over a billion in revenue in 2026 (16.5% growth rate), with an EPS of $1.39, and increase from $1.25 in 2025. And 2027? 5 analysts project an average EPS of $1.84. That means Clear Secure will have a PE of 18 in 2027, while putting off a 1.52% dividend and share buybacks on top of that.
Now, it’s not a 10 bagger within a year-type opportunity, most likely. For Clear’s margin of safety to hold, the growth rate must at least stay at these levels. If some recession or event were to occur that significantly put a damper on travel, YOU 0.00%↑ could see a re-rating in its multiple. That’s just the cold hard truth of wall street. But if you look past the immediate, and appreciate the monopolistic strength of Clear Secure, this is not an expensive purchase for a company growing top-line at 17%, with an owner-operator-founder, and great cash flows.
