Digital fraud detection company BioCatch has become a new major shareholder. UK-based private equity firm Permira is acquiring stakes in the company “primarily” from existing investors including Bain Capital, Maverick Ventures and Tech Opportunities in a value-driven secondary market transaction. Biocatch is worth $1.3 billion.
Existing shareholders Sapphire Ventures and Macquarie Capital are also increasing their stake in BioCatch, but neither company has disclosed the amount. Permira also declined to confirm how much of a majority stake it currently holds in BioCatch.
This is the second notable private equity deal announced in the past week in the cybersecurity space. Thoma Bravo announced last Friday that it plans to acquire British cybersecurity firm Darktrace in a $5 billion deal that will take it private.
Permira acquired a “significant minority stake” in BioCatch last year in a similar secondary market transaction with existing investors, making it the company's third-largest shareholder after Bain and Maverick. According to reports at the time, BioCatch's valuation had topped $1 billion at this point, meaning investors have since increased their valuation of the Israeli cybersecurity company.
Founded in 2011, Tel Aviv-based BioCatch develops technology that helps banks and other companies track users' online behavior to determine whether a customer is genuine or a fraudster. This can help, for example, identify bots attempting to access online bank accounts through strategies such as “credential stuffing.”
The company has raised well over $200 million to date, including tranches from financial giants such as American Express, HSBC, Barclays, Citi and National Australia Bank.
This latest deal is Permira's largest known transaction since taking email security company Mimecast private for $5.8 billion a little more than two years ago. Permira says it will use its investment and position as a major shareholder to bring a “growth mindset” to BioCatch, with plans to expand further across Europe.
“Permira has supported the cybersecurity theme for several years, with the online fraud detection, customer identification and access management markets being a clear focus,” said Permira, Partner and Co-Head of Growth Opportunities. Stefan Ziarski said in the press. release. “We have been closely following BioCatch for many years, and now that we have been shareholders since early 2023, our belief in this business, its growth potential, technology leadership, and management team continues to grow. It continues.”