With the $205 million funding round that Signifyd announced today, the fraud and consumer abuse leader is among the companies that will lead ecommerce into a new era marked by new consumer habits and new requirements for retailers.
The Series E growth equity financing was a company milestone for sure. Signifyd enters its second decade of providing commerce protection with a market valuation of $1.34 billion and both the means and the talent to push ecommerce and ominichannel retail into the future for years to come.
- Signifyd secured a $205 million Series E round of funding.
- The latest investment values the company at $1.34 billion.
- The funding will fuel Signifyd’s expansion of its identity-centric commerce protection.
- Signifyd will continue its aggressive global expansion.
- The diverse pool of investors underscores Signifyd’s past performance and the tremendous market opportunity ahead.
Owl Rock Capital led the funding with participation by financial services provider FIS and late-stage-growth and public market investors Canada Pension Plan Investment Board (CPP Investments) and Neuberger Berman Investment Advisers. The array of investors says a lot about Signifyd’s past performance and about the bright future ahead.
“Last year we saw ecommerce sales and influence propelled into 2025. And yet the online checkout experience is stuck in 2015,” Signifyd CEO Raj Ramanand said in announcing the funding. “With this latest investment, Signifyd has the roadmap, the resources and technical talent to enable merchants to push the customer experience to that future state — and to keep pushing it forward for years to come.”
Signifyd launched to level the retail playing field
Ramanand and Co-Founder Michael Liberty launched Signifyd in 2011 when they saw that online merchants were at a disadvantage because banking and credit card rules left them liable for fraudulent orders when physical stores were protected by banks.
In the years since, they have consistently extended the sort of guaranteed protection Signifyd provides merchants. The company’s move now to extend its identity-centric commerce protection and payment optimization deeper into the payment journey is the next logical step in what Ramanand and Liberty set out to do.
“I’m not surprised that Signifyd is building a new way of understanding shopper identity around the world and across the shopping journey,” said Santosh Marrivagu, head of UK & Ireland for Emma, Europe’s most-awarded mattress brand. “In one of our strategically key markets we partnered with Signifyd in the midst of a once-in-a-century pandemic. Within months, Signifyd was providing us with between 6% and 7% uplift. And we were serving customers better by making sure legitimate buyers were not being turned away.”
Signifyd built the first comprehensive Commerce Protection Platform to provide broad fraud protection, abuse prevention and payment optimization. The platform provides merchants with an average 5% to 7% revenue lift and higher in many cases. And now Signifyd is poised to take the concept of payment optimization to a new level by:
- Harnessing its vast commerce data to ensure merchants use the most efficient, highest-conversion payment path for each individual order.
- Working with banks, payment gateways and other financial institutions to maximize transaction approval rates.
- Future-proofing payments for merchants by providing a friction-free checkout process while constantly adapting to compliance mandates and regulations.
All this comes at a time when the ongoing shift to ecommerce has been dramatically accelerated by the lockdowns and customer wariness brought on by the COVID-19 pandemic. The swift movement is a sign that ecommerce is in for an era of rapid change — one that will make Signifyd’s innovation all the more vital, according to Kurt Tenenbaum, a managing director at Owl Rock.
“We were thrilled to partner with Signifyd to enable the further growth and adoption of their differentiated and compelling offering, which is able to provide merchants with the frictionless and secure ecommerce solutions that we believe are important in today and tomorrow’s retail marketplace,” Tenenbaum said. “The team at Signifyd have built the type of leading technology company we seek to invest in, and we could not be more excited about what the future holds for the company.”
Better commerce protection is needed for the post-COVID era
Nearly 80% of consumers surveyed on Signifyd’s behalf by market researcher Upwave said the pandemic has changed the way they will shop in the future. In short, significant percentages said they would do more of their shopping online and that they would turn more often to buy-online-pick-up-in-store and curbside pickup.
Online retailers are also seeing a significant wave of shoppers who had never or rarely shopped online, according to Signifyd’s Ecommerce Pulse data. And brands in big numbers are turning to selling through a direct-to-consumer model.
These historic changes open merchants up to more fraud pressure for a host of reasons:
- A surge in orders brings with it more fraudulent orders.
- Buy online, pick up at the store or at the curbside requires extremely fast order review and requires the legitimacy of the order be determined without a delivery address and the valuable identity signals that come with that.
- New shoppers, by definition, are unknown shoppers, so they provide no transaction history to guide fraud and risk management teams.
- Selling directly to consumers means brands are responsible for fraudulent charges. Moreover, brands might be new to fraud management and the customers they are selling to are definitely new to them.
Along with the dramatic changes comes constantly increasing consumer expectations for a trouble-free experience when shopping and checking out online. More than half of shoppers in a Signifyd survey said they would tolerate no more than one bad online experience before quitting a retailer for good.
All of these trends underscore the importance and understanding the identity and intent behind online orders while still providing an enjoyable shopping experience.
“As the global ecommerce market continues to grow and payments and checkout needs become more complex, merchants require more sophisticated solutions to optimize transaction acceptance while protecting commerce,” said Jim Johnson, head of Merchant Solutions at FIS. “We are impressed with Signifyd’s innovative approach to this market need and are excited to partner with them.”
The investment positions Signifyd’s commerce protection perfectly for the future
Signifyd’s latest group of investors point to strong pre-IPO credibility and momentum — crossover investor Neuberger Berman and long-term public equity investors like CPP Investments. It also includes one of the world’s leading financial technology companies — FIS.
The combination of the investment and accompanying expertise will help Signifyd accelerate its Latin American expansion and continue its growth in EMEA. The global footprint will include ongoing additions to Signifyd’s product, customer success, risk intelligence and data science teams while expanding its development and engineering teams.
The investment and the potential it unlocks is certainly worth reflecting on. The funding round is no doubt a milestone, but it is only the beginning of the next stage. The new era of ecommerce starts today.