BioCatch, a US-Israeli startup, recently unveiled details regarding the close of its $30 million round in growth funding. The company is known for developing its behavioral biometrics technology for authentication and threat detection to help banks and other transaction businesses prevent online fraud even before it happens.
Maverick Ventures led the round, which represented a combination of pure and strategic venture backers. Furthermore, participating parties included JANVEST Capital, American Express Ventures, Kreos Capital, OurCrowd, NexStar Partners, CreditEase among other investors.
Created in 2011 by self-acclaimed professionals in artificial intelligence, machine learning, and big data, BioCatch has been taking on cybersecurity from an online identity perspective. The company’s technology mainly looks at the online behavior of customers in a bid to identify and avert potential fraudsters. Alternatively, the traditional approach involved adding extra endpoint security layers such as using a password combined with a passphrase and two-factor authentication.
Once the BioCatch technology is installed, for instance on a bank’s application or website, it not only collects but also evaluates over 500 cognitive parameters in a bid to produce a unique profile. This situation can be likened to the way you shake a mouse, especially when the cursor disappears from the screen. Subsequently, the technology utilizes this endeavor as a reference point to validate whether you are the person you claim to be. By doing so, BioCatch’s technology tackles phishing attacks effectively since it does not depend on averting fraudsters from getting in but instead it deters them from committing any harm when or if they do.
According to a statement by BioCatch’s chief executive officer, Howard Edelstein, BioCatch technology requires businesses or companies to rethink their online security. For this reason, it has become a major impediment for the company to sell into corporate institutions. Worst-case scenario, the challenge involves getting in front of an ideal person who will be interested in a demonstration of BioCatch’s technology. The conversation becomes much easier after the demonstration since the technology can reveal issues that other cybersecurity systems would fail to show.
Howard Edelstein pointed out that the behavioral biometrics technology market has ultimately become a race in the past 24 months. He attributed this situation to the increasing awareness of the technology among corporate institutions and BioCatch’s financial institution customers. Although BioCatch has concentrated on blue-chip businesses, primarily large banks, the company plans to expand its focus to other close sectors where an identity approach can function without issues. Some of the potential targets include P2P payments, healthcare, insurance, cryptocurrency, and government.
Edelstein added that the startup intends to invest in its product selection. According to him, the task is now possible considering that BioCatch has gathered adequate behavioral data and trained its technology to learn differences in a fraudster’s behavior.
In the meantime, the startup is focusing on its vast IP portfolio, which boasts over 56 patents that are either pending or granted. One of BioCatch’s granted patents includes the system, device, and method of recognizing the identity of a mobile electronic device’s user.