justt Raises $70M to Fight Chargebacks with AI | Fintech News

Justt Emerges from Stealth with $70 Million in Funding

Justt, a chargeback mitigation startup headquartered in Tel Aviv, has officially launched publicly and secured a total of $70 million in funding.

Established in February 2020 by Roenen Ben-Ami and Ofir Tahor, Justt provides fully automated dispute resolution for chargebacks experienced by online retailers.

Recent Funding Rounds

The company recently completed a $50 million Series B funding round, spearheaded by Oak HC/FT, based in Greenwich, Connecticut.

This followed earlier investments, including a $15 million round led by Zeev Ventures in February and a $5 million raise guided by F2 Venture Capital in November 2020.

Strategic investors include David Marcus, previously president of PayPal; Jacqueline Reses, former head of Square Capital; and Gokul Rajaram, an executive at DoorDash.

Rapid Growth and Expansion

Justt, formerly known as AcroCharge, reports a 900% increase in annual recurring revenue (ARR) since September 2020.

The company’s employee base has grown significantly, now exceeding 110 individuals, compared to just three a year ago.

The valuation associated with the Series B funding round has not been disclosed.

Understanding Chargebacks and Justt’s Solution

Chargebacks are requests made by credit card issuers to merchants to cover losses from fraudulent or contested transactions.

Justt aims to assist merchants globally in combating false chargebacks through its proprietary artificial intelligence technology.

The Problem of “Friendly Fraud”

“Friendly fraud,” or false chargebacks, occur when customers improperly dispute charges, leading to financial losses for merchants.

Justt’s AI-driven technology identifies potentially incorrect chargebacks, which account for at least 85% of all disputes and contribute to over $125 billion in annual losses.

The system is customized for each merchant, integrating with their card processors to gather evidence and submit it to credit card companies.

Replacing In-House Mitigation Programs

Justt intends to serve as a replacement for internal chargeback mitigation programs, particularly for larger enterprises like fintech company Melio and Wyre, a blockchain-based payment provider.

The company currently processes over 10,000 chargebacks monthly for select clients.

“Many merchants accept chargeback losses as an unavoidable cost of doing business, but we at Justt believe there is a better approach,” stated CEO and co-founder Tahor.

Differentiating Justt from Competitors

The executive asserts that Justt differs from companies like Chargehound, Chargeback.com, and Midigator, which primarily offer technological tools.

“These other solutions still require clients to maintain an internal team with the necessary expertise to create templates and collect supporting documentation.”

He emphasizes that Justt provides a comprehensive, full-service solution.

Some competitors offer full-service options, but rely on manual evidence creation using offshore teams.

“This reliance on manual processes and generic templates often results in suboptimal performance,” Tahor explained.

Justt’s research teams analyze merchants’ checkout procedures, terms of service, email confirmations, and chargeback reason codes to deliver a more tailored service.

A Risk-Free Business Model

Justt operates on a success-based model, meaning merchants are only charged a fee if funds are successfully recovered.

“We don’t impose integration or per-case fees; we only charge a fee when our merchants succeed in reducing transaction fraud and realizing savings,” Tahor clarified.

The Pandemic’s Impact and Future Plans

The company was founded during the pandemic, a period marked by a surge in online transactions and associated fraudulent chargeback activity.

“Demand for our solution has increased dramatically, driven by the overall growth of e-commerce and specific pressures like economic uncertainty, supply chain disruptions, and delivery delays,” Tahor noted.

The newly acquired capital will be invested in product development, sales, and marketing, including expansion into the U.S. and European markets.

Justt also plans to triple the size of its research and development team in Israel during 2022.

“We are planning an aggressive expansion into North America, including establishing our U.S. headquarters in New York City and opening a West Coast office,” Tahor said.

“We will also focus on serving the European region based on market opportunities.”

Industry Expert Perspective

Matt Streisfeld, partner at Oak HC/FT, states that Justt helps recover 60% to 80% of funds lost due to illegitimate chargebacks.

He observes that while the e-commerce boom increases the risk of illegitimate chargebacks, many businesses lack the systems to identify, track, dispute, or recover lost revenue.

“Most businesses simply absorb these losses, which is unsustainable and costly,” Streisfeld concluded. “This positions Justt for significant adoption in the coming years as merchants seek new solutions.”