A Polish Solution to Plague of Online Account Takeovers Powered by $6.7M Series A
- Covid-19 , SaaS , Cybersecurity
- 15.07.2021 08:30 am
Nethone's passive behavioral biometrics allows online businesses to seamlessly stop over 95.3% of account takeovers (ATO) - cyber threats that have been spreading globally at an alarming rate. Besides ATO, the Polish fraud fighter has been flourishing in its payment and financial application use cases, systematically proving over 10 p.p. higher fraud detection precision than the conventional methods.
Atmos Ventures and ARIA are leading Nethone's most recent fundraising alongside Innovation Nest, Plug and Play Ventures, Firlej Kastory and several business angel investors. Series A will allow Nethone to accelerate its go-to-market efforts and further strengthen its proprietary Know Your User (KYUTM) profiling technology to equip global leaders with the right tools against fraudsters.
COVID-19 boosted the significance of cybersecurity given the pandemic-induced growth of demand for direct-to-customer online commerce (both web and mobile) and the associated next-generation financial services. The past 12 months provided Nethone with sufficient momentum to more than double its client base, but also enjoy increasing volumes in onboarded accounts across eCommerce, digital goods & services and financial services verticals.
Fighting fraud in the COVID era
The last year has seen an unprecedented spike in fraudsters’ activities. COVID-19 has fueled a "professionalization of fraud" trend that Nethone has been observing systematically escalate since the company’s inception in 2016. “Barriers to entry for fraudster-wannabes have been steadily decreasing. More and more sophisticated SaaS-based tools became available for anyone with some financial resources at their disposal. Today, these are advanced technical solutions built by well-organized, highly experienced groups of rogue IT experts. Wrapped in a user-friendly interface and excellent customer support they allow for complex anonymisation and automation functionalities as well spoofing of historically trusted digital identities that most of the incumbent fraud detection solutions stand no chance of spotting” – states Hubert Rachwalski von Rejchwald – Nethone’s CEO.
“The forward-looking answer to anyone who wishes to effectively transact online is to deeply understand every single user, as they browse the website or use a mobile app. Our KYU profiling technology gives access to first-hand real-time insights about what is really happening with the device, how this device interacts with the servers of the platform and, last but not least, what is the raw behavior - keystrokes, mouse movements, gyro or accelerometer readings, touches on mobile). These are currently over 5000 attributes that we are extracting passively in the background about every single user thanks to years of targeted research and engineering, Importantly our goal is never to affect the customer journey by staying invisible in the background nor invade end-user privacy thanks to the low-level nature of the attributes we collect” – adds Aleksander Kijek, Nethone’s CPO.
Besides expanding its go-to-market efforts, the plan is to use the capital to increase the velocity of roadmap progression with a constructive obsession with features that will maximize perceived utility among the company’s target segments.
Series A led by international investors
Today Nethone’s market success is fueled by: (i) first-hand expertise concerning modus operandi of fraudsters automatically converted into engineering; (ii) unique profiling capabilities on mobile; (iii) state-of-the-art passive behavioural biometrics for recurring user authentication; and (iv) explainability of its machine learning that boosts client adoption.
Nethone’s new investors are internationally known for their investments in transformational high-tech scale-ups focused on research, development and commercialisation of cutting-edge technologies.
“With the post-COVID critical significance of fraud prevention and the fierce competition in creating the frictionless user experience, Nethone has a novel approach to profiling technology fueled by machine learning. And since Atmos is focusing on developing deep technologies in ML-driven commercial solutions, Nethone Profiler combined with the explainability of the machine learning models was an obvious choice for us,” said Hadi Solh, Managing Partner at Atmos. “We are elated to join the team to arm online merchants with deep tech tools against fraudsters.”
“The accelerated growth of eCommerce in the pandemic era - up 30% in value by 2020, naturally increases the scale of fraud in the digital space. Nethone solves the problem of online payment and identity fraud, with annual losses worth around $50 billion. Their technology provides maximum protection without affecting the end-user experience. I see huge potential for the application of this technology, including other companies in our portfolio - wherever payments are involved. I am impressed with Nethone’s highly motivated team, as well as the organizational maturity for an early-stage company. Nethone has proven successful in onboarding clients ranging from traditional banks to fast-growing start-ups across the globe" - highlights Dariusz Lewandowski, CEO of ARIA.
Diego Montes, Venture Capital Investor from Plug and Play Ventures underlines that Nethone’s innovative user profiling, which encompasses more than 5,000 attributes, combined with ML and a specialized team of data scientists, has demonstrated the strength of Nethone's products. These unique elements have allowed Nethone to win clients over its competitors proving their immediate ROI.
You can read more about Nethone here.