US online retailers lost more than $24 billion last year to fraud. 47% of online merchants don’t use even the most basic 3rd party anti-fraud tools, opting instead to manually review their problematic orders. Organized fraudsters are aware of these statistics and will often test stolen cards on smaller sites before moving to more complex schemes at larger retailers.
Fraud.net, the leading crowdsourced fraud prevention solution for online merchants, enables merchants to pool their fraudulent and suspicious order data into a real-time, searchable and shareable database. This SaaS solution is the largest effort to combat online fraud using retailers’ collective intelligence. Fraud.net’s solutions can be used as a standalone system or in line with other systems.
Whitney Anderson, Serial Entrepreneur
Whitney Anderson, co-founder & CEO of Fraud.net, has a BA from Cornell University. With earlier experience in international banking at Bank of America and Security Pacific, he founded and sold several companies including MotherNature.com, one of the fastest growing private companies in the US, before it was acquired in 2013. He also opened and led the Moscow Office of Kroll Associates, a world-renowned specialist in identifying and tracking high-profile institutional and governmental fraud. Mr. Anderson says,“There are 3 key values that I believe are important to starting any new venture and to overcome the challenges that invariably follow. For me they are clarity, perseverance and purpose.”
Fast, Accurate, Affordable Services
The company offers three primary products, Fn “Early Warning”, identifies and tracks users entering your site in real-time, alerts you if their device has been involved in fraud and detects patterns indicating potential fraud; Fn Risk Score, analyzes over 4,500 fraud indicators and creates a user risk score for every transaction submitted, all in less than 200 milliseconds. The merchant then receives an ‘Accept’, ‘Reject’ or ‘Review’ recommendation; and Fn Order Profile, generates a detailed transactional profile and network history for every order. This makes manual reviews and customer authentication easier, more accurate and much faster.
With the experience of running several e-commerce businesses, Fraud.net’s team got different perspective and a much more practical approach to developing an effective fraud prevention solution. Fraud.net’s solution allows participating merchants to safely and anonymously share fraud data and information in real-time. This “network effect” allows merchants to leverage fraud resources across thousands of retailers to root out fraud.
The mission of Fraud.net is to make the internet safer for everyone. They believe that this can be achieved by creating a greater transparency online through networking and collaboration.
Fraud.net is currently expanding their services to targeted international markets, so that their merchants will be able to ship internationally with greater confidence. The advancements in processing speeds and data storage combined with the growing user accessibility has created an environment that is ripe for innovation.
Suggestions for Startups
Entrepreneur mantra – “Every journey begins with one step”. Get started and just keep moving forward. Challenges arise, but so do opportunities. Realize that the next new big idea, killer app or unicorn is most likely going to get its start in someone’s garage, kitchen table, or college dorm. So why not start with a small step?