Finextra: CVC Capital Partners' Growth Fund makes $80 million investment in Kount Inc16-Dec-2015
Kount Inc. (“Kount”) and CVC Capital Partners (“CVC”) announced today that the CVC Growth Fund will provide an $80 million growth equity investment to Kount, a leading provider of online and mobile fraud detection and prevention solutions.
The investment will enable Kount to accelerate product innovation, expand its global footprint, and enhance customer support services.
Based in Boise, ID, Kount provides cloud-based fraud detection solutions that enable merchants to reduce fraudulent transactions made online and via mobile while increasing revenue by accepting more valid orders. Kount eliminates or reduces manual reviews of potentially fraudulent transactions for its customers, reducing credit card chargebacks, improving customer satisfaction, and drastically reducing fraud, in many cases by more than 90 percent.
Kount works with a number of sectors, including retail, financial services, and gaming, touching billions of transactions and devices every year. Its end-to-end solution is used by thousands of merchants, payment processors, and payment service providers around the world, including Chase Paymentech, PayPal-owned Braintree, New Balance, Spotify and Bodybuilding.com. Kount owns its own proprietary technology and holds dozens of patents in the space.“Online merchants face greater fraud challenges than ever before,” said Brad Wiskirchen, CEO, Kount. “CVC’s funding and strategic guidance will provide Kount with significant resources to continue investing in our industry-leading fraud prevention solutions and to deliver the tools our customers need to combat fraud every day. We’re excited to partner with CVC in our next stage of growth as we continue to develop the industry’s most effective and efficient online fraud prevention solution.”
The industry is poised for growth as recent reports anticipate that the fraud detection and prevention industry will expand from $9 billion to over $21 billion in 2019. Furthermore, the 2015 Mobile Payments & Fraud Survey found that many organizations are not keeping pace with mobile fraud growth, as over half (60%) of respondents are uncertain if mobile fraud is growing at a faster, slower or equal pace as their overall mobile transaction volume.
“The payments fraud and security industry is one that we have been actively targeting for a while, and we identified Kount as the obvious industry leader,” said Jason Glass, Managing Director at CVC Growth Partners. “Kount’s long track record of success in a rapidly expanding market will become even more critical to merchants and payment processors as mobile and internet commerce grows.”
“This investment is perfectly aligned with CVC Growth Partners’ strategy of partnering with uniquely positioned technology companies in large, growing markets,” added John Clark, Managing Partner at CVC Growth Partners. “We are very pleased to work alongside Brad and his team to build on Kount’s success to date.” The investment in Kount is the second made from the CVC Growth Fund, following an investment in Wireless Logic in February 2015.
Portico Capital Securities LLC served as exclusive financial advisor to Kount with respect to this transaction.