Riskified is an all in one e-commerce company that prevents fraud and chargeback by ensuring that their customers (merchants) are always ahead of fraudsters. The company uses Artificial Intelligence fraud-prevention solutions that enable merchants to identify fraudulent customers and also boost conversion rates quickly. As a result, the company allows the merchants to reduce losses resulting from fraudulent transactions, increase sales, and also deliver quality customer experience. Eido Gal is among the pioneers of Riskified, but what do you know about him? Here are some quick facts to enlighten you about this businessman.
1. He is the co-founder of Riskified.
Eido Gal was only 27 and Assaf Feldman was 42 when they started the company. The gentlemen met when they were both working at Fraud Science Corporation in Tel Aviv and had a common ground since both had experience in fin-tech and fraud prevention. At that time, all the companies, including those that operated online, managed their fraud processes internally. Eido did not see the logic in businesses doing everything, yet they could outsource some operations to enable them to concentrate on core business functions. They began working with e-commerce merchants and reviewed their declined orders. With their experience, the duo was able to approve 30%-70% of the rejected orders. After Eido and Assaf helped merchants to decrease losses, they started looking for other ways to increase revenue for companies.
2. What he did before co-founding Riskified
Eido Gal started as a researcher in the Israeli Defense Forces from January 2003 till January 2006. He was then a fraud analyst and worked at Fraud Science Corporation from September 2007 till January 2008. PayPal later bought the company in 2008 for $169 million, and PayPal absorbed Eido in the risk department from January 2008 to January 2009. He then moved to the automation department at PayPal and worked for one year and four months. Eido was then recruited by Bill Guard and worked in the analytics department from September 2011 to November 2012, before moving on to start his company.
3. He sometimes writes blogs
Riskified has a company blog for which Eido sometimes writes to make an announcement or update their customers about online fraud. The latest post he has written is "Announcing Riskified's $165 Million Funding Round." In the blog post, the company wants to raise funds to expand its geographical footprint and improve their products. He also wrote another one, "Misaligned Incentives," which talks of Riskified being different from other companies because of their pricing structure. They also guarantee transactions if the risk successfully occurs.
4. He wants the company to keep expanding.
The company began at Tel Aviv and now has a branch in New York. They hope to reach more businesses in the USA, but they are already working with merchants across all continents to analyze transactions from 235 countries. As the company grows and with a funding of $165 million, Riskified wants to expand to more areas beginning with Asia and Europe. They were hoping to have an office in Shanghai.
The development is currently happening in the Tel Aviv office. The organization is in a six-story building, where you can spot several bicycles since employees prefer them as their mode of transport. It also has headphones at every employee's desk so that they are not distracted. You can also see dogs sitting on the floor or running around because the company's policy encourages it. Thus, the growing number of employees might not fit; hence they are planning to move to a much bigger building.
5. He is open-minded, diverse, and employs immigrants.
The company sees that the principal reason for their success is the employment of new immigrants. Currently, the company has employed around 450 employees and looks to hire more than 700 employees by the end of 2020. It has the highest percentage of immigrant employees in Tel-Aviv. Immigrants understand Riskified's diverse culture and target market. Understanding the market is the critical reason for their success because there is a lot of thought put into knowing foreign cultures. Ephraim Rinsky, who is a content writer at Riskified, says on The Jerusalem Post, "Manhattan can be stressful and intense. Here, we work extremely hard, but the company understands that there is a lot to live outside the office." The company focuses more on the individual and his potential rather than a qualification based resume.
6. Eido had investors in the company's Series E funding.
General Atlantic led in raising $165million and was supported by others like Fidelity Management & Research Company, Winslow Capital Management, and their existing investors. Their Series E funding summed up to more than $1billion, which will help in scaling their business both locally and internationally.
7. His company's biggest challenge faced while raising capital.
Making the market understand who they were and what they do was difficult. Eido and Assaf were the initiators of chargeback-guarantee fraud prevention, and not many people had heard of this concept. Some of the other new ideas included false declines and bank declines that they had to do a lot of market education. The investors later understood the problem and the solution they offered, facilitating them to come on board.
8. Why Eido thinks Riskified is different.
They came up with the chargeback-guarantee model, where they offer merchants "approve" or "decline" recommendations. They also guarantee their decisions compared to those in the market that offer scoring solutions where orders are given a fraud score and left for the merchants to decide. Moreover, the company is focused on increasing revenue by looking for ways to approve more transactions so that the clients make more sales.
9. Who Eido considers as Riskified's competitors?
Internal teams that merchants previously used and legacy solutions are some of the primary competitors. Merchants rely on analysts who review orders manually. Legacy solutions either disqualify transactions based on strict criteria or assign order score. Legacy solutions are also conservative and need to be regularly maintained as fraud evolves. The two approaches are challenging to scale as merchants grow and do not maximize revenue. Riskified, on the other hand, has teams focus on developing the business and delivering excellent customer experience.
10. How Eido convinced investors to donate in the Series E funding
The growth potential and excellent performance of Riskified was evidence enough for the investors to dig deep into their wallets. Their ARR surpassed $100M in 2018, and they also experienced hyper-growth with 250 % CAGR over the past five years. His company grew while simultaneously earning profits, which is a good indicator for investors.
Written by Allen Lee
Read more posts by Allen Lee