FERO Payment Science (FERO) is delighted to announce the successful closure of a $3 million seed round from Coatue, Volta Ventures, and Antler.
This capital will enable FERO to expand and enhance its unique online payment solution to tackle the $5T of annual revenue merchants lose at the point of checkout.
After working for Ekata, a global payments fraud solution and then Mastercard (after Ekata was acquired), co-founders Craig Savage and Maximilian van Boxel saw firsthand how complicated payments processing has become at checkout for end-merchants.
Data shows that the majority of online shoppers that reach the checkout stage fail to complete their purchases. Today’s 'one size fits all' approach to the checkout experience and payment journey is a significant barrier to purchase conversion. While participating in Antler’s founder residency in 2022, the team identified an opportunity to create personalised purchase preferences that would make it easier and more seamless for consumers to complete their payments.
“As a payments data scientist, I was shocked when I started to uncover the level of abandonment during the checkout and payment journey. Today, upwards of 45% of customers place items in their shopping cart, but never finalise their purchase due to payment related issues. This translates to over $5.2 trillion of lost revenue per year,” explains Craig Savage, Co-Founder and CEO, FERO Payment Science. “We founded FERO to help retailers deliver a more seamless and customised shopping experience to their customers.”
FERO’s solution analyses each shopper, their behaviour and activity, to predict the likelihood of purchase completion. Through the sequenced application of segmentation, multi-classification prediction and reinforcement learning, FERO learns a shopper’s purchase preferences and delivers the most optimal payment experience. This includes individually customised payment methods and subsequent payment journeys like reducing the friction caused by 3D secure authentication challenges.
"While payment innovations have made transactions faster and more seamless, few solutions have looked at the behaviour of shoppers to understand why so many items are left un-purchased in the online shopping cart," says Elena Sakach, Partner, Coatue. "It's exciting to see the FERO team take a unique approach that leverages behaviour analytics to deliver purchase solutions that will improve the shopping experience and drive revenue for retailers."
With the capital from this seed round, FERO will build out its team across Europe and the US, and further enhance its product offerings to serve more retailers around the world.