Pindrop Security, a startup focused on combating phone-based fraud, today announced that it has closed a $1 million seed round of financing, coming from a sizable pool of investors that the company says will be used to grow its customer base and expand product development.
The Atlanta, Georgia-based company provides solutions that help detect and block phone-based fraud. The company explains that its “acoustical fingerprinting technology” can detect fraudulent calls and authenticate legitimate callers, helping customers reduce financial losses and operational costs. The company also says its technology can verify the geographic origin of a call and the phone type based on audio analysis.
With Caller ID easily spoofed, cybercriminals are able to steal billions of dollars annually from individuals, banks and other enterprises, the company explained. According to the FTC, 29 percent of fraud victims are first contacted by phone. According to Gartner, "in most banks, the phone channel remains seriously exposed." In fact, Pindrop says it saw the volume of attacks increase by 52 percent in the second half of 2011.
Pindrop Security has developed and begun deploying products to customers including:
• Phone Reputation Service – a threat intelligence service that includes a database of fraudulent callers from around the world as well as analysis and predictive tools to track phone number reputation
• Fraud Detection System – technology that analyzes phone calls to identify fraud by determining the true geographic origin and phone type
The company’s patent-pending algorithms are based on research developed at the Georgia Tech Information Security Center. Pindrop has also received grants from the National Science Foundation SBIR program, GRA’s VentureLab and funding from the Technology Association of Georgia.
Pindrop’s cofounders include Paul Judge and Georgia Tech professors Dr. Mustaque Ahamad and Dr. Patrick Traynor. Judge serves as executive chairman and was previously CTO of CipherTrust which was acquired by Secure Computing, CTO of Secure Computing which was acquired by McAfee, and founder and CTO of Purewire which was acquired by Barracuda Networks.
The company was named one of the 10 Most Innovative Companies at the 2012 RSA Conference and a Gartner “Cool Vendor” in Enterprise Unified Communications and Network Services for 2012.
Investors in the round include prominent VC firm, Andreessen Horowitz, GRA Venture Fund, New World Ventures, Sigma Partners, and Webb Investment Network. Angel investors Paul Bricault, Kevin Donahue, and Ben Ling have also joined the round. Additional Atlanta investors participating in the round include Flashpoint, Mark Buffington of Buckhead Investment Partners, and Tal Cohen, founder of Clickfox.