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Fraud prevention startup ThirdWatch raises seed funding from IAN, others

10 October, 2017

Gurgaon-based ThirdWatch Data Pvt. Ltd, an artificial intelligence-powered anti-fraud solutions startup, has raised an undisclosed amount in a seed round led by Rahul Agarwalla of the Indian Angel Network, a company statement said.

Keshav Sanghi, former managing director of Goldman Sachs India and founder of investment firm VentureWorks India, and financial advisory firm Batlivala & Karani Securities also invested, the statement added.

The funding round marks IAN’s first investment from its eponymous Rs 450-crore IAN Fund.

“Over the past few years, we have seen e-commerce fraud grow both in scale and variety. We need adaptive solutions to prevent fraud losses,” Agarwalla said in the press note.

ThirdWatch was founded in 2016 by Adarsh Jain and Shashank Agarwal. The company’s offerings help in real-time fraud detection and prevention. Its flagship product Mitra evaluates in real-time whether every transaction is fraudulent or genuine based on a trust score. This score is generated through machine learning algorithms, a user’s browsing behaviour analysis, device fingerprinting, location profiles and other evaluation parameters.

Indian e-commerce is expected to jump from $30 billion in 2016 to $120 billion by 2020, the company statement said citing research reports. Some prominent problems prevalent in the e-commerce space are return-to-origin issues, promo code abuse, duplicate item returns, and payment gateway fraud. Globally, the money lost over fraud on digital transactions, including mobile and web, was over $30 billion, and that figure is over $500 million in India alone. Digital transactions have seen a 50% year-on-year growth, the press note stated.

“ThirdWatch has successfully reduced the return to origin problem in online orders by more than 80% within three months of going live for their current clients,” said Agarwal, co-founder and CTO of ThirdWatch.

An IIT Bhubaneswar and IIM Ahmedabad alumnus, Jain had earlier worked at mobile analytics firm rocQ analytics, ad-tech firm Ahoy Telecom and IT services major Wipro in his earlier stints. He had also co-founded two ventures—CricketWeekly.in, a cricket t-shirt design company and Mobile Nirvana Technologies Pvt Ltd, which provided mobile-based location services. Agarwal is an IT engineer from the Rajasthan Technical University and had also previously worked at rocQ analytics and Ahoy Telecom.

In April this year, IAN marked the first close of its fund at Rs 175 crore. VCCircle had exclusively reported in February that fund had received commitment of around Rs 200 crore and also had a green show option of Rs 100 crore.

IAN’s Rs 450 crore fund will invest in sectors including healthcare and medical devices, software as a service, marketplaces, fintech, big data, artificial intelligence, and hardware. While almost one-third of the fund was earmarked for co-investment, almost two-thirds will be allocated for subsequent rounds at investee companies. The rest of the money will be deployed at firms where IAN members are not investors. Together, IAN and the IAN Fund (plus co-investors) would invest approximately Rs 1,500 crore in 160 odd companies over the next four years.

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Fraud prevention startup ThirdWatch raises seed funding from IAN, others

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