Feedzai Raises $200 Million Investment Led by KKR
Series D financing values Feedzai well above $1 billion Capital to be used to further strengthen company’s market-leading position
San Mateo, California & Lisbon, Portugal – March 24th, 2021 – Feedzai, the world’s leading cloud-based financial risk management platform, today announced a $200 million Series D investment round led by leading global investment firm KKR, with participation from existing investors Sapphire Ventures and Citi Ventures. The new investment will be used to accelerate the company’s global expansion, further develop its product offerings, and boost its partner strategy to strengthen its position as one of the most comprehensive financial crime prevention and risk management solutions in the market.
Feedzai’s platform is used by the world’s leading financial institutions, payment providers, and merchants to manage the risk of financial crime while enabling an optimized experience for end-users. The core of Feedzai’s offering is its artificial intelligence and machine learning platform, which processes customer and third-party data to identify, assess, and accelerate the remediation of potential threats.
The net result of this approach is significantly higher rates of financial crime detection with lower rates of false positives in contrast to legacy, often rules-based approaches, and meaningful cost savings for customers through fewer charge-backs, more efficient triage of alerts, and avoidance of regulatory fines. In addition, Feedzai’s technology allows a more seamless, real-time experience for consumers. Feedzai’s core offering originally focused on identifying transaction fraud, but in recent years has leveraged the underlying technology to expand into adjacencies such as anti-money laundering and account opening – making Feedzai one of the most comprehensive cloud-based financial crime prevention platforms in the market.
The investment comes as demand for Feedzai’s technology is accelerating alongside the rapid shift to digital banking and commerce, which has led to a significant increase in consumers becoming victims of financial crime. In the last quarter of 2020 alone, consumers faced a 650% increase in account takeover scams, a 600% in impersonation scams, and a 250% increase in online banking fraud attacks compared to the first quarter in the same year, according to Feedzai’s data.
Today, Feedzai monitors companies with more than 800 million customers in 190 countries, with products protecting half of the U.K.’s and Canada’s populations, as well as four of the five largest banks in North America. Many of the world’s largest financial institutions, such as Citibank, Fiserv, and Santander, as well as the world’s most innovative Fintechs such as SoFi and Mox by Standard Chartered, already use Feedzai’s AI-powered risk management solutions. Every time someone opens a bank account, transfers money, or makes a payment with their mobile device, they are experiencing transparency, convenience, and protection in 3 milliseconds or less – all made possible by Feedzai’s AI platform.
"Feedzai’s technology is the cornerstone of today’s commerce as consumers across the globe expect fast, reliable, seamless, and, above all, secure banking and payment experiences. The world has faster digitization requirements, and financial institutions need reliable solutions that thrive in this new digital environment in days, not months,” said Nuno Sebastiao, CEO and Chairman of Feedzai. "We’re thrilled to be working with KKR to bring more innovation into this space and to keep protecting our customers from an ever-evolving financial crime landscape.”
"Feedzai offers a powerful solution to one of the biggest challenges we are facing today: financial crime in the digital age. Global commerce depends on future-proof technologies capable of dealing with a rapidly evolving threat landscape. At the same time, consumers rightfully demand a great customer experience, in addition to strong security layers when using banking or payments services,” said Stephen Shanley, Managing Director at KKR.
Spencer Chavez, Principal at KKR, continued, "We believe Feedzai’s platform uniquely meets these expectations and more, and we are looking forward to working with Nuno and the rest of the team to expand their offering even further.”
The investment follows the close of another exceptional financial year where Feedzai saw significant growth in all its geographic markets and customer verticals. In addition to its core offering, the company recently launched "Feedzai Solutions,” an initiative aimed at democratizing the fight against financial crime by allowing financial institutions of all sizes to benefit from the most advanced technology available today in an "out-of-the-box” format. The company has also expanded its Responsible AI framework, which was recently recognized as "Fraud Prevention Innovation of the Year” by Fintech Breakthrough, to allow financial institutions to provide the best customer experience possible while ensuring that Fairness, Accountability, Transparency, and Ethics (FATE) become part of the decision-making process.
KKR will be making the investment through its Next Generation Technology Growth Fund II, a fund dedicated to growth equity investment opportunities in the technology space.
Feedzai is the market leader in fighting financial crime with today’s most advanced cloud-based risk management platform, powered by machine learning and artificial intelligence. Feedzai has one mission: to make banking and commerce safe by combining fraud prevention and anti-money laundering under one platform to manage financial crime. Founded by data scientists and aerospace engineers, Feedzai is considered best in class by Aite and one of the most successful AI companies by Forbes. The world’s largest banks, processors, and retailers use Feedzai to safeguard trillions of dollars and manage risk while improving customer ex
KKR is a leading global investment firm that offers alternative asset management and capital markets and insurance solutions. KKR aims to generate attractive investment returns by following a patient and disciplined investment approach, employing world-class people and supporting growth in its portfolio companies and communities. KKR sponsors investment funds that invest in private equity, credit and real assets and has strategic partners that manage hedge funds. KKR’s insurance subsidiaries offer retirement, life and reinsurance products under the management of The Global Atlantic Financial Group. References to KKR’s investments may include the activities of its sponsored funds and insurance subsidiaries. For additional information about KKR & Co. Inc. (NYSE: KKR), please visit KKR’s website at www.kkr.com and on Twitter @KKR_Co.