PayPal Holdings, Inc. continues its shopping spree with the second start-up purchase in the same week. Today it announced that it is acquiring Simility, a leading artificial intelligence (AI) based online fraud prevention solution to the global digital business. According to the agreed deal, PayPal has purchased Simility for $120 million in cash.
The merger will get close by the third quarter of this year. Following this, Simility Co-founder and CEO Rahul Pangam and the Simility team will report to VP of Enterprise Services Platforms of PayPal, Tushar Shah. Prior to this acquisition, PayPal had secured 3 percent stakes in Simility the previous year.
“PayPal’s platform and trusted brand are backed by a world-class risk management engine. Together with our strong machine learning capabilities and customizable risk tools, we can bring even greater value to merchants and partners,” Pangam mentioned in the blog post.
Simility is a leading artificial intelligence (AI) based online fraud prevention solution to the global digital business. Source: PayPal
PayPal’s Takeover Addiction
The open digital platform, PayPal serves 237 million active account holders in more than 200 markets of the world. It has built a secure and fraud-proof system over the years for sending money, paying or getting paid.
The giant online payment company PayPal, operating for 20 years, for now, has acquired seventeen companies in total till now. Significantly, four out of those 17 companies made to PayPal’s basket in the first half of 2018 alone. Besides Simility, earlier this week PayPal mentioned that it will take over Hyperwallet, another payment payout start-up for $400 million in cash.
Last month, PayPal purchased San Mateo-based Jetlore, an AI predictive retail start-up for an undisclosed amount. And before that, it made its biggest acquisition deal with the Sweden-based financial technology company, iZettle for whopping $2.2 billion in cash. Known as the “Square of Europe”, iZettle offers point-of-sale software and other services to brick-and-mortar shops.
Association with Simility
Moving forward, the global businesses have rapidly shifted to the data-centric and digital-first world. “Organizations everywhere are racing to gain an advantage by providing smarter, more connected services for their customers. These services are built on the processing of a volume, velocity and variety of data never before seen,” mentioned on Simility blog.
PayPal has agreed to purchase Simility for $120 million in cash. Source: PayPal
But this new business environment has given birth to new risks. “Digital commerce has exploded, and fraudsters have taken note, adapting and developing new methods to carry out their crimes,” said Bill Ready, Chief Operating Officer, PayPal.
Though PayPal has built a secured solution for itself, its merchants have not been able to integrate such future-proof system. By combining the forces of Simility, PayPal aims to give control to those businesses to handle the intricate trading complexities while enhancing fraud prevention.
Adaptive Risk Management Solution
Founded in 2014, Palo Alto-based Simility leverages artificial intelligence and big data analytics to aid professionals working in the fraud detection and risk assurance sphere.
“Our vision for Simility was to create an adaptive risk management platform that empowers organizations operating in a digital world to manage an evolving fraud and risk landscape where data breaches are the new normal,” said Pangam.
Post the acquisition, the PayPal merchants will gain access to Simility’s best-in-class fraud tools. An individual merchant can customize these tools to meet individual business requirements through account management dashboard which will then result in improved business insights.
Pangam adds, “We’re able to create and ingest data from your site and app, enhance it with custom feeds from virtually any source, model and analyze it,” he added.
Simility’s AI-based fraud prevention and risk assurance system will eventually adapt and evolve with each transaction. Subsequently, it will enhance payment experiences for merchants and their customers by solving complex fraudulent payment activities and improving trust.
