A group of venture capital firms, led by Institutional Venture Partners (IVP) are bankrolling contact center security specialist Pindrop Security’s $35 million Series B round of financing. IVP joins Andreessen Horowitz, Citi Ventures, Felicis Ventures and Redpoint Ventures, all of whom had participated in prior financing rounds, totalling $12 million. Because IVP has distinguished itself in the past as a “late stage investor,” its leadership role signals that knowledgeable investors expect market acceptance of technologies that secure the so-called “phone channel” to ratcheting up on a global basis.

A Pindrop spokesperson confirmed that the company would be hiring 100 new employees, primarily in sales, marketing and product development, as reported in the Atlanta Business Journal. The company has already made headway into the UK, Canada and Brazil, and expects to step up its focus in Singapore, Western Europe and Latin America.

To review Pindrop’s technology and value proposition, at the core is a large database of phone numbers that have been used by known fraudsters and, therefore, generate a high “score” when it comes to assessing the risk associated with a caller. The database is dynamic and was generated in part by using Pindrop’s proprietary Fraud Detection System (FDS). The firm coined the term “Phoneprinting™” to capture the idea that every call has unique attributes. The FDS technology breaks each call down and analyzes “over 150 (and growing) characteristics” in order to generate the phoneprint that leads to 90%+ accuracy in detecting such important factors as “the location of the caller and the type of device being used to originate the call  (VoIP, Cell, Land) – even the network type for VoIP calls (Skype, etc.).”

Last year, Pindrop launched FDS Version 2 to integrate voice biometrics-based caller authentication with phoneprinting. This fulfilled the market requirement, articulated by regulatory bodies and industry analysts alike, for layered, multi-factor approaches to both authentication and fraud detection. Yet one of the most important factors driving anticipated growth for Pindrop and its cohort of companies attacking phone fraud is the ability to employ risk-scoring in ways that go beyond fraud prevention. Experience in the field has led to some interesting new market propositions that can be encapsulated as follows: “If a high score is a strong indicator of a “bad” call (which should be dropped or routed to security); doesn’t that mean that a low score equates to a “good” call (or one where there should be high expectation of a positive outcome)?”

The real issue involved in such scoring is trust, which is a foundational requirement for both Conversational Commerce and Intelligent Assistance. Pindrop and its investors recognize the growing value of low risk/high value calls that are made possible by recognizing the value of taking both voiceprints and phoneprints into account as factors to identify the value of a call, as well as the probability of significant fraud.

Categories: Conversational Intelligence, Intelligent Authentication, Articles

Tags: Voice biometrics, Phone Fraud, venture capital, Institutional Venture Partners