Investments

Startup Riskified Wants $200M To Fight eCommerce Fraud

Riskified Seeks $200M To Fight eCommerce Fraud

An Israeli startup that creates anti-fraud services that deal with online transactions wants to raise $200 million for expansion, according to a report in Bloomberg.

Riskified, which was founded in 2013 and is based in Tel Aviv, is potentially considering going public, possibly by 2020. When asked, however, the company didn’t provide any details about its future business. “Riskified does not comment on its financial plans,” a representative for the company said.

Fraud is becoming an increasingly more common problem in the eCommerce sector, and is estimated to cost merchants about $130 billion over the next five years.

“At Riskified, our goal is to turn fraud management into a growth engine for online retailers,” the company said on its website. “We know that a great shopping experience is the key to consistent and sustainable growth, so we built the ultimate frictionless eCommerce fraud prevention solution.”

Riskified utilizes machine learning to identify and get rid of suspicious orders. Its clients include Samsung and Swarovski International Holding.

The company has raised $64 million so far from a number of investors, including Genesis Partners, the investment company of Bernard Arnault, the chairman and chief executive officer of LVMH, as well as Qumra Capital and Pitango Venture Capital.

Many Israeli tech startups have attracted investor interest lately, and investment has increased in the past three years  to the tune of 37 percent – a total of $856 in 2018.

In a blog post, the company outlined its views on fraud in eCommerce. “Fraudsters are constantly looking to exploit vulnerabilities in eCommerce. They try a number of different approaches (‘attack vectors’), and if one is proven effective, they exploit it until it’s discovered and the vulnerability closed,” the company said. “Fraudsters are ever-evolving, and, in order to stay ahead of them, merchants must stay abreast of the latest forms of eCommerce fraud to preempt them as quickly as possible.”

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The How We Shop Report, a PYMNTS collaboration with PayPal, aims to understand how consumers of all ages and incomes are shifting to shopping and paying online in the midst of the COVID-19 pandemic. Our research builds on a series of studies conducted since March, surveying more than 16,000 consumers on how their shopping habits and payments preferences are changing as the crisis continues. This report focuses on our latest survey of 2,163 respondents and examines how their increased appetite for online commerce and digital touchless methods, such as QR codes, contactless cards and digital wallets, is poised to shape the post-pandemic economy.

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