Capture this: CAPTCHAs are on their way out, if one Ann Arbor startup has its way.

A new firm called Are You a Human, started and managed by recent master’s graduates from the University of Michigan Ross School of Business, is taking aim at CAPTCHAs, which are distorted images of text that Internet users often have to decode to make purchases or post web comments.

The firm’s founders say they’re close to securing outside investment for the company and that they plan to introduce their CAPTCHA alternative sometime this summer.

Are You a Human is developing a game that could replace CAPTCHAs. People would take just a few seconds to complete the game, but that activity would be enough to certify that the user is not a computerized “spambot” — a perpetrator of web clutter whose existence necessitates the existence of an authentication step.

“Everyone we talk to, the first feeling they express when they think about CAPTCHA is frustration,” said Reid Tatoris, an April MBA grad from U-M who is co-leading the company. “All of us find CATCHAs annoying and want to get rid of them.”

The company last month got a $154,100 influx in cash after a strong performance at the Rice University Business Plan Competition in Houston. The event is generally considered one of the top contests for graduate student entrepreneurs in the U.S.

Are You a Human, which took second place among 42 teams, won a $100,000 investment for winning the Most Promising Technology Startup award.

Tyler Paxton, who earned his MBA from U-M in April, was the first to come up with the group’s idea for a CAPTCHA alternative. He developed the idea after witnessing a work colleague try to land tickets for a Hannah Montana concert.

Tickets were gone within minutes and the Wall Street Journal later reported that Ticketmaster suspected a coordinated computerized rush that allowed ticket scalpers to surpass the CAPTCHA hurdle, lap up tickets and put them onto resale sites with a big markup.

Paxton said that Are You a Human’s technology would improve the user experience and boost website security, thus reducing the chance of incidents like TicketMaster’s.

The company’s founders said their revenue model could involve integrating advertising messages into the game they would use to replace CAPTCHAs.

But getting websites that use CAPTCHAs to adopt Are You a Human’s technology will be one of the company’s first objectives, co-founder and April U-M MBA grad David Levitch said.

Levitch said test users have provided “really positive feedback” and that the company hopes to let prospective clients use their replacement a few times to understand why it’s a good alternative to CAPTCHAs.

“It’s going to be a lot of direct outreach,” he said.

Are You a Human’s founders have declined to discuss details of their technology for competitive reasons, but they have already developed a beta version. They estimate that web users fill out 300 million CAPTCHAs a day.

For now, Are You a Human is based at TechArb, a business incubator for startup companies led by University of Michigan students. The company plans to stay until October, at which point the company’s leaders, which include April MBA grad Biswaroop Palit, first-year MBA student Benjamin Blackmer and U-M computer science student Stuart VandenBrink, will have to decide where to go.

“It’s really important for us to stay here, for us to start a company here,” Tatoris said. “We want to change Michigan, we want to turn it into a place where people create jobs instead of going to work for someone else.”

Nonetheless, Paxton said that the founders would “do what’s best for the company eventually.”

Contact AnnArbor.com's Nathan Bomey at (734) 623-2587 or nathanbomey@annarbor.com. You can also follow him on Twitter or subscribe to AnnArbor.com's newsletters.