Despite the global nature of fraud and fraud prevention, the U.S. is still home to the largest number of anti-fraud companies. Popular these days are startups dedicated to Trust & Safety issues related to bots, fake accounts, and problematic content. Nevertheless, startups dedicated to other fraud problems have also appeared on the scene in the past few years. Read below to find out more about some of the more promising ones.
Cove
Cove is a 2-year-old startup was co-founded by two ex-Meta employees who worked on the company’s Trust & Safety team. Its solution helps clients create and train custom Large Language Models (LLM) AI models for detecting text, audio, and images that violate trust & safety policies. Video support is supposedly coming soon as well to Cove’s product offering.
With Cove’s AI models and Automated Enforcement product, companies can make automated moderation decisions. Zero technical knowledge is required to train models. Instead, like with Open AI, Cov e recommends that users take your plain English content policies and turn them into AI models by teaching them the nuances of their policies. However, Cove claims its product is roughly 100X cheaper than trying to do the same thing using Open AI and it also provides an easy-to-use user interface.
Disputed.ai
Officially launched by two ex-SeatGeek employees, Shawn Kelley and Andrew Hart, earlier this year, Disputed.ai is a relative newcomer to the chargeback management space. The company is focused on providing a consultative approach to designing chargeback management solutions for large enterprise merchants. Like some of the more recent startups in the chargeback management space, Disputed seeks to utilize machine learning to ingest data that will help determine whether to fight chargebacks and how to create an evidence packet for representment that is likely to win. Thanks to its use of artificial intelligence, Disputed’s solution should become more intelligent over time as it incorporates chargeback response feedback data into its decision-making processes.
Dodgeball
Dodgeball is a fraud orchestration platform built to enable merchants to take a plug ’n’ play approach to trying out and implementing different anti-fraud solutions. After integrating with Dodgeball, adding or removing new anti-fraud solutions involves minimal effort and not an entirely new integration project that would require significant engineering resources and time. The company has previously been covered by Merchant Fraud Journal, and at present has roughly a half dozen team members, most of them engineers.
Perhaps unsurprisingly, Dodgeball has a developer-centric approach to customer acquisition, with a free-tier to allow developers to play around with the product before talking to salespeople. According to its CEO, Adam Hiatt, it also isn’t necessarily targeted at large Fortune 500 enterprises, but at the growing market of medium and even non-Fortune 500 large-size companies growing in the online economy.
Effectiv
A 3-year-old startup with headquarters in San Francisco, Effectiv is working on building the next generation anti-fraud platform for financial institutions. Effectiv changes how financial institutions manage risk – pushing them from reactive to proactive protection. Integrated with leading risk data services, Effectiv customers can customize KYC, KYB, payment, AML or account activity risk strategies to detect and prevent fraud at multiple steps of the user journey.
The startup promotes its ability to orchestrate risk related data from multiple sources, provide an intuitive case management and alert decisioning system, and enables directing filing of SAR and CTR reports. In addition, Effectiv’s AI Model Library provides instant access to a wide range of supervised and unsupervised machine learning models that can be rapidly deployed to enhance fraud detection.
Last but not least, this startup is junior PayPal mafia. All the co-founders are ex-PayPal employees – meaning they have plenty of experience approaching how fraud impacts a large financial institution.
Honeypot
Honeypot is a Trust & Safety platform that enables clients to collect, visualize, and process insights about their users from a legal, threat, and compliance perspective. The activities the platform can be used to deter include illegal activity, platform abuse, reputational harm, ban evasion tactics, as well as free trial and promo abuse. The key to using Honeypot is a simple API integration that relies on zero personally identifiable information (PII) data. The startup is still very much in its early days, with less than a handful of employees. However, several fraud fighter influencers already have heard of it, placing it on the industry’s radar. It will be interesting to see how it evolves.
Verisoul
Austin-based Verisoul is another early-stage Trust & Safety platform with a handful of employees. It enables clients to outsource fake account detection, prevent account sharing, bot detection to prevent automated account creation and credential stuffing, prevent spammers and locate and block click farms. The company already raised $3.25 million in seed funding in 2023, which makes it stand out from some of its competitors. The solution, which can be added to an application with a single line of code, works with mobile, web and gaming software.
