End-to-end fraud prevention solution for eCommerce merchants, including a BNPL solution.

Riskified has built a next-generation eCommerce risk management platform that allows online merchants to create trusted relationships with their consumers. Leveraging machine learning that benefits from a global merchant network, our platform identifies the individual behind each online interaction, helping merchants eliminate risk and uncertainty from their business. We drive higher sales and reduce fraud and other operating costs for our merchants and strive to provide superior consumer experiences. Our eCommerce risk management platform is built to solve merchants' pain points with proprietary machine learning models that drive an automated decisioning engine. We have designed our platform to be fast, accurate, scalable, and cost-effective. It supports our core chargeback guarantee product—which optimizes merchant approval rates—as well as other products that mitigate similar eCommerce risks for those same merchants. All of our products are designed to generate additional revenue or cost savings for merchants while improving the online shopping experience for their consumers: •Chargeback Guarantee: Our core product, the Chargeback Guarantee, automatically approves or denies online orders with guaranteed performance levels that vary in accordance with our merchants’ priorities. •Policy Protect: Policy Protect helps merchants identify consumers that may be taking advantage of a merchant’s policies in ways that are abusive and expensive to the merchant. •Deco: Deco helps merchants combat bank authorization failures during the checkout process. •Account Secure: Account Secure helps prevent a consumer’s saved account with a merchant from being compromised by a fraudster. •PSD2 Optimize: PSD2 Optimize enables merchants to minimize the effect of the European Union’s Payment Service Directive 2 regulations on their eCommerce business.

In contrast to other fraud prevention solutions in the market that rely on scoring and rule-based technologies, the chargeback guarantee solution, which was first offered to the market by Riskified, provides a binary decision — either to approve or decline the transaction. In addition, our unique eCommerce risk management platform, an end-to-end fraud prevention solution covering the whole customer journey, is designed to provide the following benefits to merchants: •Increase sales: We allow merchants to generate higher revenues by increasing their approval rates for online transactions. Our platform can increase merchant sales approval rates by, in some cases, more than 20%. •Reduce fraud: Our platform automatically identifies and rejects fraudulent online transactions that would result in unnecessary expenses for our merchants. We also assume the cost of fraudulent transactions if they are approved. Net of our fees, our platform can reduce these costs for our merchants, in some cases, by more than 60%. •Reduce operating costs: We replace antiquated systems and labor-intensive, costly fraud fighting methodologies with automated algorithms that save our merchants significant time and money. By reducing the operating costs our merchants incur, we free resources that can be redirected towards growing their businesses. •Optimize consumer experiences: Higher approval rates mean lower consumer drop-off and fewer false declines of legitimate consumers. Our product gives merchants the ability to take full advantage of emerging omnichannel flows such as buy-online-pickup-in-store and buy-online-pickup-at-curb without increasing the risk of fraudulent sales. In addition, we enable merchants to maintain consumer-friendly policies by preventing policy abuse and malicious account logins. This builds a stronger, long-term relationship between merchants and consumers, driving more sales to merchants over time.

On May of this year, Riskified has announced the launch of the latest version of Deco, a real-time solution for recovering orders lost to card-not-present payment authorization failures. The product Deco converts up to 20% of those declined transactions into immediate sales, delivering a significant ROI to merchants and boosting customer satisfaction. What happens behind the scenes is Deco uses Riskified’s AI-powered decisioning platform and the breadth of its merchant network to identify the legitimacy of the shopper behind the transaction. Once confirmed as legitimate in real-time, the transaction is intelligently submitted for payment authorization to increase the overall approval for the merchant.

*Deco is currently available from Riskified for US merchants and non-US merchants that have a significant amount of US-based sales.

Riskified generates a substantial ROI for our merchants through the revenue and cost savings they realize. On average, our ten largest merchants that provided data to us of their pre-Riskified performance by Billings experienced an 8% increase in revenue after integrating with our eCommerce risk management platform. On average, those same merchants experienced a 39% decrease in fraud-related operating costs and chargeback expenses. As a result of this value add to our merchants, we have high merchant revenue retention- for the year ended December 31, 2019 and 2020, we had an Annual Dollar Retention Rate of 99% and 98%, respectively, out of a maximum possible 100%. Excluding merchants from tickets and travel, our Annual Dollar Retention Rate was 99% for each of the years ended December 31, 2019 and 2020.

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