Sorenson News
Sorenson Capital invests in Bureau, a risk intelligence platform that prevents fraud without causing annoyed customers and slowed business growth.
By now, everyone understands that fraud is a permanent element of the digital landscape—an ongoing risk for which we need ongoing mitigation tools. But it might surprise some folks to know the extent to which online fraud harms consumers, businesses, and progress.
According to a recent FBI report, U.S. consumers likely lose more than $12.5 billion each year to schemes like identity fraud, account takeovers, and other abuses. The average business misses out on 5% of annual revenue due to fraud. Meanwhile, mainstream strategies for preventing these losses—processes like two-factor authentication and CAPTCHA tests—result in bad user experience, consumer frustration, abandoned shopping carts, lost customers, and slow innovation and growth.
The groundbreaking risk intelligence platform Bureau offers an unprecedented solution.
“Bureau utilizes a unique combination of device, behavior, financial, and partner data to quickly block predators without creating deal-breaking headaches for users,” says Rob Rueckert, a Partner at Sorenson Capital. “By preventing fraud while avoiding any harm to customer retention, revenue, and growth, Bureau is truly differentiated in the vast and significant fraud-prevention space.”
Bureau has raised a $30 million Series B, led by Sorenson Capital, with participation from PayPal Ventures and existing investors, including Commerce Ventures, GMO Venture Partners, Village Global, Quona Capital, and XYZ Ventures.
A head start and a leg up in a large, fast-growing market
Every year, the world’s pool of hackers grows, and their methods for stealing sensitive data become more advanced. In fact, predators have gotten so good at what they do that they cause more than $5 trillion in losses globally each year, an increase of 56% over the past decade. The result is a global fraud detection and prevention market valued at nearly $44 billion.
Bureau corners this market in two ways.
First, the technology underlying Bureau’s products and services are more seamless for clients and end users. Most fraud detection programs rely on broad-stroke rules to flag suspicious activity—causing customers to jump through annoying hoops and leading to erroneously canceled transactions. Conversely, Bureau leverages multiple data points to verify the user well before they attempt a sensitive exchange, meaning the user simply provides a phone number to verify their identity.
Second, Bureau is the unified platform to manage compliance and fraud risk, from account opening to continuous monitoring. This technology is broadly applicable across industries and databases, including banking, credit, social media, e-commerce, and consumer internet platforms. Because of Bureau’s comprehensive integration capabilities, the company is well positioned to capture a large portion of the global fraud prevention market quickly, which is expected to reach $255 billion by 2032.
Getting a jump on the fraud-detection tech of tomorrow
The rule-based engines used in legacy fraud-detection programs are pre-programmed with simple conditions such as “block transactions over $1,000 from a new device.” This inherently reactive technology comes with huge downsides: It results in frequent false positives, blocking legitimate transactions; and it quickly becomes outdated as hackers evolve their tactics. Thus, consumers lose trust and businesses lose money.
Bureau’s fraud prevention programs, on the other hand, leverage graph neural networks (GNNs), which chart financial ecosystems as graphs—uncovering hidden connections, detecting subtle patterns, and adapting to evolving fraud tactics. GNNs address the shortcomings of rule-based legacy systems in three ways:
- Superior analysis: GNNs map the complex relationships among customers, transactions, devices, and accounts, revealing hidden links that traditional models miss.
- Adaptability: GNNs continuously learn and evolve, staying ahead of emerging fraud patterns and minimizing false positives.
- Contextual awareness: GNNs consider the broader context of each transaction, incorporating information about the customer’s profile, device history, and network connections and yielding more accurate risk assessments.
“Graph neural networks represent a paradigm shift in fraud prevention,” explains Bureau CEO and co-founder Ranjan Reddy. “By 2030, I expect GNN-based architectures to become the de facto standard for enterprise fraud detection. Bureau is pioneering this transformation today, protecting billions in transactions through our advanced neural network infrastructure.”
Identifying a gap, and jumping at the chance to fill it
Prior to Bureau, Ranjan founded Qubecell, a successful mobile payment platform that was acquired by Boku, where he served as Chief Business Officer.
Drawing from his deep expertise in payments and fraud prevention, Ranjan recognized the limitations of traditional fraud detection systems that relied on rigid rules and fragmented solutions. While legacy providers offered basic point solutions, the market needed an AI-powered platform that could deliver continuous and comprehensive protection through advanced neural networks and real-time risk intelligence. This vision led to the creation of Bureau’s revolutionary identity decisioning platform.
On the cutting edge of the latest fraud prevention threats
Online fraud is increasing and expanding at a startling rate. In the U.S., consumer losses jumped by 22% from 2022 to 2023 alone, according to the Federal Bureau of Investigation’s Internet Crime Complaint Center. Unfortunately, the more business we conduct online, the more targets we create for cybercriminals.
Today’s most damaging threats impact all types of businesses, from large banks to mom-and-pop retailers. Bureau’s platform prevents a wide range of fraudulent activities, from sophisticated account takeover attempts targeting major financial institutions to referral abuse impacting ecommerce retailers.
Bureau’s Money Mule Score product has emerged as a breakthrough solution for detecting money mule accounts – one of the most challenging problems in money movement. Since its launch, the product has prevented hundreds of millions fraud losses, including $9 million for one of the largest banks in Asia.
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