Tech Talk: Riskified takes the risk out of e-commerce
Riskified uses proprietary behavioral analytics technology and machine learning in order to investigate a prospective client’s trustworthiness.
By ARIEL SHAPIRAUpdated: FEBRUARY 18, 2016 10:11RISKIFIED’S CEO Eido Gal (right) and CTO Assaf Feldman. ‘Our system saves millions of dollars when it detects fraudulent activity.’(photo credit: Courtesy)
Founded in 2013 by CEO Eido Gal and CTO Assaf Feldman, Riskified is a pioneering Israeli startup that develops e-commerce fraud prevention tools. Riskified is a risk management solution that guarantees peace of mind for hundreds of global companies by verifying, approving and guaranteeing transactions and offering a 100 percent chargeback guarantee.“Our technology directly affects our clients’ profit margins, as well as improving overall customer satisfaction,” said Gal. “Our system saves millions of dollars when it detects fraudulent activity, and also when it approves companies that our clients would have rejected had we not guaranteed their protection.”Riskified uses proprietary behavioral analytics technology and machine learning in order to investigate a prospective client’s trustworthiness.Its technology analyzes online consumer behavior using machine learning algorithms that are updated in real time to distinguish accurately between legitimate and fraudulent entities. Riskified provides services for a variety of industries including high-end fashion, entertainment and travel, and some its largest clients are Burberry, Viagogo and Wish.The company recently raised $25 million in a financing round led by Qumra Capital, along with Phoenix Holdings, NTT DOCOMO Ventures, and existing investors Genesis Partners and Entrée Capital. This round follows previous funding which totaled $6 million.“Riskified’s exponential growth is indicative of the e-commerce industry’s need for a fraud-prevention platform that uncovers new revenue opportunities,” said Erez Shachar, the managing partner at Qumra Capital. “With such an experienced team, a proven technology and a global portfolio, we feel secure that Riskified has positioned itself well to become a world leader.”With branches in Tel Aviv and Boston, Riskified currently has a staff of 80 employees, most of whom work in R&D at the Israeli branch. In 2015, the company’s market cap grew five fold, and Riskified is expected to process $5 billion worth of transactions by the end of 2016. In order to keep up with such rapid growth, the company is planning to recruit dozens of new employees for its Tel Aviv and Boston offices, potentially even doubling its work force by the end of the year.According to a study conducted by Javelin Strategy & Research, each year, $118 billion worth of legitimate credit card transactions in the US alone are denied due to their false identification as fraudulent attempts. This amount far exceeds the actual amount of incurred losses from credit card scams: $9 billion. The study also shows that consumers are mostly harmed due to the postponement of orders more than due to misidentification, and that Millennials (people born from the 1980s to early 2000s) suffer more than older individuals. As a result, 66% of those surveyed claim that they’ve limited or completely stopped making purchases online from specific businesses.Buying Purim costumes online A smart and simple alternative to purchasing Purim costumes and items at the mall or other stores around town, is going online. A number of Israeli and international sites offer a seemingly endless supply of products at extremely attractive prices, but in order to ensure a secure shopping experience, shoppers should take a few precautions.“Buying Purim costumes online is a great alternative,” says Efi Dahan, PayPal’s regional director of Israel and Africa. “However, consumers should act wisely. Firstly, deliveries are oftentimes delayed, so you should order your products well ahead of the holiday. Secondly, it is imperative to check out a number of sites in order to find out what the options are and to compare prices.
“Facebook groups also offer a wealth of information, including reviews by people who’ve bought items from that site in the past. It is also important to check in advance each site’s policies regarding shipping costs and returns, and of course to choose a secure payment method, such as PayPal,” he added.PayPal offers a service called, ‘There’s a Way Back,’ which enables customers to have their shipping fees refunded from PayPal regardless of the reason the product is being returned (product returns are subject to the store’s policy).This service is offered free of charge on the PayPal website and is subject to the terms and conditions of the plan.Tips for shopping online: • Check reviews by friends and other users regarding specific products on the site you’re interested in purchasing from. Search social networks and Facebook groups to find recommendations for quality products and websites.• It’s best to stick with large, well-known sites.• Check shipping, replacement and return policies before making a purchase.• Check if there will be any additional charges, such as VAT, customs or other taxes.• In order to ensure correct sizes, check if the website includes a size chart. If not, request the seller send one to you.• PayPal is the preferred way to pay for online purchases since by doing so you do not need to disclose your credit card information to sellers.• PayPal offers consumers an extra layer of protection by refunding purchases that never arrived or if the wrong item arrived. Subject to the terms of service.• ‘There’s a way back.’ Customers using PayPal can have their shipping fees refunded.If you run a young startup, have developed an interesting app or have a question, please feel free to contact info@social-wisdom.com.Translated by Hannah Hochner.