Justt comes out of stealth with $ 70 million to fight back fraud with AI

Justt, a company developing an AI-powered platform to combat fraudulent reversals, has today emerged from stealth with $ 70 million raised through three funding rounds, including a Series B led by Oak HC / FT and two previously unannounced rounds led by Zeev Ventures and F2 Venture Capital, respectively. CEO Ofir Tahor says the proceeds will be used to expand Justt’s sales and marketing activities in the United States and Europe and triple the size of the company’s Israel-based R&D team.

False chargebacks, also known as “friendly fraud”, occur when customers mistakenly dispute credit or debit card fees – and cost online sellers an estimated $ 125 billion in lost revenue. As transactions move online, this type of fraud has become more common. Ecommerce retailers stand to lose about $ 20 billion in 2021 due to criminal activity, according to Juniper Research – an 18% increase over 2020.

Justt’s product combines artificial intelligence with human reviewers to gather evidence that refutes illegitimate chargebacks and work with credit card companies on behalf of merchants. Justt integrates with merchant payment providers and launches conflict resolution when the platform’s algorithms detect potentially incorrect chargebacks.

“The pandemic has changed online purchases, leading to a boom in online transactions and a consequent increase in fraudulent chargebacks. It has made many merchants realize that their existing laissez-faire approach to chargebacks is not scalable or sustainable – and it has, in turn, driven an increase in demand for chargeback solutions, “Tahor VentureBeat said in an email. , supply chain problems, labor shortages and more – which make it difficult to redirect resources to efforts to mitigate the house. “

Fighting reversals with AI

Valby, Denmark-based Justt was co-founded in 2016 by Tahor and Roenen Ben-Ami. Tahor was previously head of social media at Adobe and Magento, while Ben-Ami served as business risk manager and fraud analyst at Simplex.com, a startup of cryptocurrency payments.

While Ben-Ami spearheaded the risk management efforts at Simplex, Ben-Ami began developing tailor-made manual processes to help crypto-traders fight back against illegitimate chargebacks. However, he quickly realized that it would require a new approach to delivering large-scale tailor-made mitigation support to all industries than just crypto, with AI-driven automation to deliver an efficient yet practical experience for merchants, ”said Tahor. “To create that solution, Roenen took me out. I had seen merchants struggle with similar challenges – and get frustrated with the low-tech, labor-intensive chargeback process – while launching e-commerce-social-marketing-startup Shopial and acting as head of Magento. ”

Justt uses artificial intelligence and machine learning to customize remedial processes on a grocery-by-grocery basis, according to Tahor. The platform builds evidence using various decision-making models for a dispute trained on data from a merchant’s transaction history, as well as live analysis of ongoing results.

Justt is currently processing millions of data points. Next year, that number is expected to grow to billions.

“Each transaction is indexed against dozens of chargeback codes used by credit card networks, providing important insights into the types of transactions that trigger chargebacks, enabling us to quickly identify and address potential fraud across a wide range of industries , “Tahor explained. “Every merchant’s Justt implementation is unique, but every merchant benefits from our ability to leverage big data from the large number of chargebacks and disputes we now investigate, spotting patterns and signals in the middle of the noise and optimizing our dispute tools in real time.”

Competition

86 percent of all chargebacks are probable cases of fraudulent fraud, according to a source, and dealers lose $ 2.40 for every dollar of chargeback fraud. At the current rate, the cost of revenue, merchandise, shipping costs and fees due to chargebacks could approach $ 30 billion by the end of the decade.

While Justt competes with Chargehound, Chargeback.com, Midigator, Chargebacks911 and ChargebackGuru in a market for fraudulent solutions worth $ 10.4 billion by 2023, the company claims that it already processes 10,000 chargebacks per month for “very large” corporate customers. Tahor attributes the success in part to Justt’s “contingent-style” business model, which only charges merchants when Justt recovers funds from a chargeback dispute.

“[Our competitors] either offer low-tech ‘hands-on’ manual products that require significant time and energy from merchants, or products that rely on non-expert-outsourced teams to manage returns for merchants, ”Tahor said. “Justt’s solution delivers a simple yet transformative core benefit – it’s a truly hands-free mitigation solution that provides a radically higher success rate when contesting reversals.”

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