Providers of online fraud prevention technology Arkose Labs secured a strategic investment from PayPal, following a series A investment round that saw the Brisbane-born startup raise US$6 million (AU$8.26 million) in September 2018, led by US Venture Partners.
Dafina Toncheva, partner with US Venture Partners, and Jeremiah Grossman, founder and CEO of Bit Discovery, also joined the startup’s board of directors.
Arkose Labs solves multimillion-dollar fraud problems for the world’s most targeted businesses with zero impact to user conversion.
It is the only solution to guarantee a 100% remediation SLA on fraud prevention.
Founded by Kevin Gosschalk and Matthew Ford, the idea was originally born out of a Brisbane Startup Weekend as FunCaptcha.
While that first iteration sought to replace text-based captchas with image-based captchas, the most recent iteration of its technology combines global telemetry with user behavioural risk assessment and enforcement challenges to defend against a wide range of issues - such as scraping, ticket scalping, spam, auction house abuse, and fake ratings.
Their patent-pending technology removes the economic window necessary to commercialise fraud through single request, brute force, sweatshop, and machine vision attacks.
The technology is now used and trusted by leading security and fraud teams around the globe, including clients such as Kik, Roblox, EA and Singapore Airlines.
Arkose Labs stated that the backing from PayPal will enable the startup to further expand its product roadmap to include further fraud prevention and digital identity capabilities.
In an announcement, Gosschalk said it was a significant moment in the Arkose Labs timeline and the PayPal investment offered validation, momentum and strength.
“It signals to our customers, the industry and any future competitors, that we are not only committed to helping organisations combat the growing online fraud epidemic, but we have the confidence, support and backing of major industry players,” he said.
“We are thrilled to have their support.”
Gosschalk also noted that Arkose Labs has prevented over US$100 million of fraudulent activity within its customer base over the last 12 month and that they have “come a long way in the last two years”.
While Arkose Labs is now based in San Francisco, they still have an office base in Brisbane.
