Signifyd secures $56 Million in Series C Funding
This post summarizes the press release published at 9:00 AM PST on May 4, 2017.
San Jose, Calif. – May 4, 2017 – Signifyd, the world’s largest provider of Guaranteed Fraud Protection for ecommerce businesses, today announced it has secured $56 million in Series C financing led by Bain Capital Ventures, with additional participation from Menlo Ventures, American Express Ventures and other existing investors. This latest round of funding will be used to expand its teams of engineers and world-class fraud experts and scale its machine learning-enabled Guaranteed Fraud Protection for enterprise merchants across the US, Europe and Asia.
For growing ecommerce companies and brick-and-mortar retailers migrating online, traditional fraud detection has become both ineffective and inefficient. Signifyd pioneered the Guaranteed Fraud Protection offering which provides a 100 percent financial guarantee against fraud or chargebacks on every approved order, thereby shifting liability for fraud away from e-tailers. With the surge in online fraud following the deployment of EMV, e-tailers are turning to scalable 3rd party experts to eliminate fraud losses, especially for orders being shipped overseas and for increased sales volume during the peak holiday season. As Signifyd is only paid on orders it approves, e-tailers get the additional benefit of accepting more orders they had previously turned away due to fear of fraud.
“Our rapid growth has been made possible by our customers’ ability to scale, enter new markets and accept orders their competitors have turned away,” explained Signifyd co-founder and CEO, Rajesh Ramanand. “Ecommerce is fiercely competitive and we see a whole new wave of competition arriving in the form of brick-and-mortar retailers shifting their focus online. In this environment, merchants are seeking a fully predictable cost for fraud that can eliminate liability and free up internal resources to focus on growth, customer service along with product and service innovation.”
The new round will be used to attract top talent across the entire company, with a key focus on doubling the current engineering department over the next 12 months. Signifyd benefits from its location in the heart of San Jose’s AI/machine learning hotbed, where it has cultivated an award-winning culture that earned it a spot in Entrepreneur’s Top Company Cultures in America list for 2017. Given its exponential growth and significant market opportunity, Signifyd was also recognized by Forbes as one of the “50 Most Innovative Companies in Fintech” and by Bloomberg as one of the “50 Most Promising Startups You’ve Never Heard Of”.
Signifyd’s Series C round follows its two funding rounds in 2016: a $20 million round last February and a $19 million surge in September. Under leadership from ex-PayPal fraud and risk experts, Rajesh Ramanand and Michael Liberty, the company also increased its number of protected merchants to more than 5,000, saw 20x growth in transaction volume, 4.5x revenue growth year-over-year and boosted its number of employees to more than 100—a 50 percent increase from the year prior. This led to Signifyd moving into a new office to accommodate its growth.
“Signifyd is emblematic of the range of industries that can be reimagined with machine learning and AI. Raj and team have invented a new approach to fraud prevention, harnessing data from over 5,000 merchants to deliver a 6x ROI to their customers,” said Indy Guha at Bain Capital Ventures, who will also be joining Signifyd’s Board. “Bain Capital Ventures has deep ties to the retail ecosystem through investments like Jet.com and our private equity arm owns retail brands like Michael Stores, BlueNile, Toys R’ Us and many others. Our belief in the Signifyd approach runs deep. Thanks to its unmatched machine learning technology, Signifyd will continue to scale and protect some of the largest online retailers.”
Signifyd supplants outdated fraud prevention methods with a combination of leading machine learning technology and human expertise backed by a 100 percent financial guarantee against fraud. Signifyd’s Guaranteed Fraud Protection—the first guarantee of its kind—fully reimburses customers for any fraudulent transactions that slip through the cracks, effectively removing liability from the merchant. As a result, Signifyd’s clients see a 15-20 percent increase in their bottom line, on average, enough to keep some e-tailers from going out of business.
Today’s news follows a series of key partnerships, awards and other recognitions that have helped solidify Signifyd as the only scalable Guaranteed Fraud Protection provider for ecommerce businesses. Within the past year, the company has partnered with Salesforce Commerce Cloud, Magento, Accertify and ThreatMetrix. Beyond Entrepreneur, Forbes and Bloomberg, Signifyd was recently recognized as the Fraud Innovation Firm of the Year at the Finance Monthly Fintech Awards and by the San Francisco Business Times and Silicon Valley Business Journal as one of the Bay Area’s Best Places to Work.
Signifyd was founded to make fraud-free ecommerce available to every business. Signifyd solves the challenges that growing ecommerce businesses persistently face: billions of dollars lost in chargebacks, customer dissatisfaction from mistaken declines, and operational costs due to tedious, manual transaction investigation. As the world’s largest provider of Guaranteed Fraud Protection, Signifyd provides a 100 percent financial guarantee against fraud and chargebacks on every approved order. This effectively shifts the liability for fraud away from ecommerce merchants allowing them to increase sales and open new markets while reducing risk. Signifyd is in use by multiple companies on the Fortune 1000 and Internet Retailer Top 500 list. Signifyd is headquartered in San Jose, CA.
About Bain Capital Ventures
Bain Capital Ventures partners with disruptive B2B founders to accelerate their ideas to market. The firm invests from seed to growth in enterprise software, infrastructure software and industries being transformed by data. BCV has helped launch and commercialize 200-plus companies since 1984, including investments in DocuSign, Jet, Kiva Systems, LinkedIn, Rapid7, SurveyMonkey, Taleo and TellApart. BCV has approximately $3.7 billion of assets under management with offices in San Francisco, New York and Boston. Follow BCV via LinkedIn or Twitter.