Correct, a Tel Aviv-based chargeback mitigation startup, is surfacing today with $70 million in total funding.
Founded in February 2020 by Roenan Ben-Ami and Ofir Tahor, Just says it fully automates chargeback disputes on behalf of online merchants. The startup recently raised $50 million in a Series B round of funding led by Greenwich, Conn.-based Oak HC/FT. Built on previous rounds, including a $15 million raise led by Zeev Ventures in February and a $5 million raise led by F2 Venture Capital in November 2020. Strategic individual investors in Justt include David Marcus, former PayPal chairman; Jacqueline Rees, former head of Square Capital; And Gokul Rajaram, a DoorDash executive.
Justt, formerly known as AcroCharge, says its annual recurring revenue (ARR) is up 900% as of September 2020. Its headcount has grown from 3 a year ago to over 110 employees. The company declined to say at what valuation its Series B was raised.
For those unaware, chargeback is defined as Demand by a credit card issuer from a retailer for damages on fraudulent or disputed transactions. It aims to help merchants globally fight false chargebacks with the artificial intelligence it has developed.
False chargebacks, also known as “friendly fraud”, occur when buyers wrongly dispute a charge on their credit/debit card, resulting in their financial institution canceling their payment and merchants. has a loss of money. Just’s AI-powered technology is designed to flag wrongful chargebacks, which typically represent at least 85% of disputes and result in more than $125 billion in annual damages, the company said. have to say. It creates a system tailored to each merchant that integrates with their card processor, collects evidence refuting illegitimate chargeback claims and submits information to credit card companies on their behalf.
Ultimately, it aims to replace in-house mitigation programs for companies, which are mostly large enterprises such as fintech unicorn Melio and Wire, a blockchain-based payments company. It handles over 10,000 chargebacks per month for some of its customers.
“The chargeback system is fundamentally unjust, but many merchants view their losses as simply the cost of doing business. At Just, we believe there is a better way, and e-commerce sellers need someone in their corner. as they navigate this archaic system,” said Tahor, CEO and co-founder.
The executive believes Just differs from other companies in the space such as ChargeHound, Chargeback.com and Midgator in that those companies provide the technical tools “but still provide customers with the relevant expertise to create an in-house template.” Requires to maintain an in-house team and collect evidence.”
“These systems rely on teams of customers to optimize and improve success rates – they don’t provide full-service solutions like Justt does,” he said.
Other competitors, he claimed, offer a full-service offering but manage evidence generation manually, using offshore teams to help customers handle chargebacks.
“The lack of a technical element means that offshore teams rely on generic templates, which leads to poor performance,” Tahor said.
Just, he says, is different in that its research team analyzes merchants’ checkout procedures, terms and conditions, confirmation emails, chargeback reason codes, among other things, to provide a more customized service.
The business model of a startup is designed to minimize risk to potential customers. It will not charge any fees from them until their money is withdrawn.
“Our business model is based entirely on success. We do not have any integration fees or per-case fees; we are successful, and only charge fees if our merchants are successful and less transactions are real due to fraud. Realizes saving the world,” Tahor told Nerdshala.
Just was founded during the pandemic, which has led to a boom in online transactions and an increase in fraud-related chargeback activities.
“Since then, demand for our solutions has skyrocketed, driven by the general growth of online businesses and transactions and specific pressures such as economic pressures, supply-chain issues, delivery delays, which should fuel an increase in fraudulent transaction reversals. are.” Tahor said.
The company plans to use its new capital to invest ,Heavy in product development, sales and marketing, including expanding its sales and marketing operations overseas in the US and Europe”. It also expects to triple the size of its Israel-based R&D workforce in 2022.
,With this funding, we plan to aggressively expand into the North America market, including setting up our US headquarters in New York City and preparing to open our West Coast offices,” Tahor said. “We will also invest in serving the European region as per market opportunities.”
Helps to recover 60% to 80% lost from post-transaction illegitimate chargebacks. Matt Streisfeld, partner at Oak HC/FT.
He notes that while the e-commerce boom is increasing the risk for businesses from illegal chargebacks, some brands have systems in place to identify, track, dispute or recover lost revenue from illegitimate chargebacks.
Streisfeld wrote via e-mail, “Most simply write off these pitfalls – a volatile and costly approach, and one that leaves JUST to hit record lows over the next 5 years as traders explore new avenues.” “