Visa Acquires Israeli Fraud Prevention Firm BioCatch for $2.4 Billion

Visa Inc. is set to acquire Israeli cybersecurity company BioCatch for $2.4 billion, two years after the investment firm Permira bought a controlling stake in BioCatch for $1.3 billion. Founded in 2011 by Avi Turgeman and the late Benny Rosenbaum, BioCatch specializes in behavioral biometric technology to detect and prevent fraud and money laundering in banking systems. The company struggled until 2018, when Gadi Mazor became CEO, at which point revenues were $7 million and valuation $100 million. By 2023, BioCatch’s annual recurring revenue grew 49% to $100 million.

BioCatch’s technology analyzes over 300 digital behavioral parameters, such as typing speed and mouse handling, to distinguish legitimate users from fraudsters who have taken over accounts through deception or extortion. Visa plans to integrate BioCatch’s solutions to enhance its cybersecurity, risk management, and fraud prevention capabilities. Visa currently protects 1.8 billion devices and 760 million users globally, serving over 350 banking clients in 21 countries.

Visa highlighted that account takeovers and fraud cause over a trillion dollars in global economic damage, with AI technologies accelerating attack rates. Over the past five years, Visa has invested more than $13 billion in payment system security technologies and infrastructure. The acquisition is expected to close in Visa’s second fiscal quarter and represents a rapid return for Permira, which invested $750 million for 60% of BioCatch two years ago. Gadi Mazor will remain CEO, and the company’s operations are expected to continue without major changes. Mazor noted Visa’s vast global reach, with 14,500 financial institutions and cardholders conducting over 329 billion transactions worth $17 trillion in the past year, offering exponential growth opportunities for BioCatch.