With billions of credit card transactions processed daily, there is an opportunity for fraudulent activity or perceived fraudulent activity. And it happens: Every year, hundreds of millions of consumers report cases of credit card fraud.
ShovelOban MacTavish co-founders Tess Bloch and Cooper Hart believe much fraud can be eliminated if card issuers have access to real-time transaction information.
When we last reported on Spade earlier this year, the company raised $5 million to decipher the string of numbers and letters that card issuers use to authorize transactions in seconds.
When a card is swiped or typed, the issuer sends Spade the data in real time. This transaction is linked to a verified merchant identity and sent to the issuer with information about who the merchant is, category and location details, in real time.
Fast forward to now, and the company is still returning that comprehensive merchant profile. It also does so at a rate of less than 50 milliseconds with 99% accuracy, which MacTavish told TechCrunch made Spade an industry leader. The average is about 250 milliseconds.
This gives Spade’s customers, including Mercury, Sardine, Ramp and Unit, the ability to have the most accurate data needed to rapidly authorize transactions, create innovative card products and improve fraud detection, in some cases by more from 15%.
“We’ve really changed our strategy,” CEO MacTavish told TechCrunch. “We found our niche in the fraud detection space, so there was a huge promotion market for us. Fraud is only becoming a bigger problem, especially as banks become more sensitive to profit margins.”
MacTavish declined to be specific about revenue and customer growth, only to say, “it’s been a big year of growth and it’s going to be another year of growth for us.”
This “big growth year” secured Spade another round of funding. It recently raised $10 million in Series A funding led by Flourish Ventures. Andreessen Horowitz, Gradient Ventures, Y Combinator, Dash Fund and Everywhere Ventures (The Fund) also participated.
Spade plans to use the money to double its current team of 13 to support continued development of technology and products, data and customer success. The company is also poised to expand outside the United States.
“When you’re selling to banks, the biggest thing is getting your first ‘beacon’ bank customer,” MacTavish said. “We will also be doing more for our customers, including developing functionality on the post-authorization side. Beyond that, the overall volume of data we deal with is something we’re always monitoring and expect to grow significantly. As we dive deeper into the banking industry, I expect this number to be the ‘North Star’ for us and possibly the No. 1 factor driving a Series B going forward.”
