Online fraud is one of the biggest challenges facing the global economy. Even in a post-COVID world where society is returning to work, entertainment, and school in person, the shift of physical activity into the digital realm continues to be a persistent trend. As the world’s digital footprint continues to grow, it creates a larger opportunity for fraudsters to take advantage of consumers and businesses. Juniper Research estimates there was $27B of ecommerce transaction volume that was lost to fraud in 2020, and expects this number to balloon to $52B in 2025. More broadly, Veriff’s 2021 fraud report estimated a 61% increase in general online fraudulent activity in 2021. Out of all online fraud, 60% is related to identity fraud. This creates a significant opportunity for fraud reduction if consumers and businesses can work together in securing online identities.

For consumers, preventing online identity fraud is mostly straightforward. We’ve all heard the basic best practices, and they’re often effective. Regularly change your password. Don’t use the same password across multiple accounts. Don’t open attachments or click links from suspicious emails. Don’t give out personal or financial information to untrustworthy third parties.

However, for businesses seeking to protect and ensure the identity of their online users, the best solution for doing that has been unclear. They deal with questions like, should we organize a fraud prevention team in-house? Do we have the engineering resources to build an effective fraud detection solution? Should we consider a third party solution provider? A consultancy, an out-sourced team, or a software vendor? Implementation costs of existing solutions can be expensive and deployment timelines can be lengthy. Fraud prevention is a mission critical business imperative, but businesses trying to solve it effectively have had to deal with unneeded costs and unnecessary complexity.

Until now. SEON is rewriting the fraud prevention playbook. Taking an API-first, pay-as-you-go approach, SEON allows businesses to go live in protecting their users’ identity within 24 hours. When a user creates an account or logs into a website, SEON runs in the background in real-time to check their digital credentials and device footprint, including email address, phone number, IP address, location data, and more. SEON then cross references this data with social media and the user’s online footprint. SEON leverages machine learning to assess a risk score and flag suspicious transactions to fraud prevention teams. This is all done in a GDPR-compliant manner, and allows companies to reduce false positives, thereby enabling more transactions while stopping fraudulent ones.

SEON’s platform goes beyond user logins though. SEON empowers businesses to conduct transaction monitoring and assess users’ credit risk on an ongoing basis. Moreover, SEON empowers both developers and fraud analysts to leverage its platform. Developers can use SEON’s API to pipe raw and enriched data into their own in-house AI models, improving existing fraud prevention systems without needing to replace them. Fraud analysts can use SEON’s admin portal to assess fraud cases, empowered with deep cross-domain data accessible through a consumer-grade user interface. Last year, SEON launched its platform as an app on the Shopify app store to enable Shopify’s nearly two million merchants to reduce fraud.

The use cases that SEON can handle are varied and growing. Today, on the identity fraud side, companies like Revolut and Nubank use SEON to make sure that when a user opens a new account on their website, or logs into an existing account, the person is who they’re claiming to be. On the transaction fraud side, companies like AirFrance and Grab use SEON to ensure that any transactions taking place are authorized by the user involved. Since the company’s inception, over 5,000 merchants across industries like banking, gaming, lending, travel, payment services, and others trust SEON to protect themselves and their users from fraud.

SEON was born out of its co-founders’ need for an easy-to-use fraud prevention platform. In 2017, Tamas Kadar and Bence Jendruszak were working on building a crypto exchange in Hungary. They began accepting credit card payments, and quickly realized fraudsters were trying to take advantage of their platform using stolen identities and chargebacks. Tamas and Bence set out to deploy a fraud prevention solution, but existing solutions on the market had taken months to implement and featured significant upfront costs. They needed something fast and affordable, but with the power to protect the integrity of their fledgling crypto exchange. So they built it themselves. After realizing how many other companies dealt with the same fraud-related challenges, they pivoted to working on developing their fraud prevention platform full-time. Five years later, SEON’s mission remains the same – to help online businesses reduce the cost, time, and challenges faced due to fraud.

We’re incredibly excited to be backing Tamas, Bence, and the entire SEON team in their Series B financing, along with the awesome team at IVP.

To learn more about SEON, check out their website, funding announcement, and see open jobs here.