Ravelin, the London-based company that uses machine learning to help businesses tackle fraud when accepting online payments, has raised $ 20 million in new funding.
Series C is chaired by Draper Esprit, with the participation of existing investors Amadeus Capital Partners, BlackFin Tech and Passion Capital. Ravelin disclosed $ 10 million in Series B funding in September 2018.
Launched in 2016, Ravelin uses machine learning and graphics networking technologies to help online businesses reduce fraud losses and improve order acceptance rates. The idea is to remove coarser, rule-based systems and use machine learning to cancel false positives and give traders more confidence in customer / transaction acceptance.
Regarding product market adequacy, Ravelin says that he first encountered success with large-scale food and taxi markets, but has since expanded to travel, ticketing, entertainment, games, games of chance and retail. In addition to identifying card fraud, Ravelin also works with customers to find compromised accounts (called "account takeovers"), spot incentive abuse, and tackle supplier fraud in the markets.
Account takeover is where fraudsters use identifying information that has been exposed in data breaches to take over an individual's online account for their own use or to sell on the dark web. "We have a product that helps secure accounts in the first place, identify at-risk accounts, and help the merchant recover the original user account," said Ravelin marketing director Gerry Carr. "It's a complex problem and because of the ease with which it can be done, a growing problem."
Incentive abuse sees users re-use and / or share coupons and incentives to register to defraud a merchant. To avoid this, Ravelin is able to map the network of users and their associated voucher codes to identify if a voucher is already used by another user and block it.
Supplier fraud typically affects markets where the customer, courier, or product supplier is trying to defraud the market. "This can happen in a number of ways," says Carr, "a simple example could be a supplier using a fake account to place an order with cash delivery. In this scenario, the market advances payment to the restaurant. Once payment is received, the restaurant cancels the order and retains the payment. We can help a marketplace to identify abnormal activity in the network and put an end to fraudulent behavior ".
Ravelin is also developing "Ravelin Accept", a product designed to help companies navigate PDS2 and accept with confidence rather than rejecting more transactions. PSD2 means that there will be much more authentication required for transactions.
"This could cause many transactions to fail, because consumers are struggling with strong authentication and merchants do not know how to get exceptions to secure authentication," says Carr. "Ravelin Accept will have integrated information on how the major issuers like to handle transactions. It will route a transaction to an authentication exemption where possible and where it is not, [it] will manage this step dynamically to give it the best chance of acceptance. The PSD2 deadline at the end of this year should see significant demand for Ravelin Accept to help with the acceptance rates. "
Meanwhile, Ravelin says he will use his C series to invest more in these innovations and reach more markets and industries around the world.
Draper Esprit's Vinoth Jayakumar comments: "Our model is to invest in long-term innovation. Ravelin aligns perfectly with this thesis. The Ravelin team is world class and continues to work to push the limits of its products... What really excited us was the range of problems they solve for customers and the suite of products they develop ".
