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Socure snaps up Berbix for $70M

Jun 27, 2023
Illustration of piggy bank wearing a robber’s mask

Illustration: Eniola Odetunde/Axios

Socure, an identity verification company last valued at $4.5 billion, acquired Berbix, another company in the space, for $70 million in cash and stock.

Why it matters: The deal comes as U.S. regulators are growing more aggressive about holding businesses responsible for fraud in this era of digital money — driving up demand for regulation technology.

Context: In the Spring, a group of five Democratic Senators sent a letter to agencies including the Federal Reserve and OCC, asking them to take a deeper look at Zelle. The peer-to-peer payments system, along with its competitors, has come under fire for the volume of fraud on its platform.

  • Last year, the CFPB was reportedly weighing guidance that would push greater liability onto banks in cases where consumers authorized a payment — but later found out it was fraudulent.

Details: Berbix boasts the ability to verify IDs, barcodes, and selfies almost instantly.

  • Socure currently offers such a product, but it uses a third-party.
  • "This is much more about product performance capabilities [and] leapfrogging our roadmap for the next 18 months to 24 months," says Socure CEO Johnny Ayers.
  • Berbix co-founder Eric Levine will be brought on as SVP and head of document verification solutions. About 20 of the 35 employees at Berbix will also join Socure.

Background: Ayers did not disclose Berbix's exact valuation at its last round, only confirming that it was around $20 million.

  • Mayfield led its last known round of financing, with participation from Initialized Capital, Y Combinator and Fika Ventures.

The bigger picture: While Socure had its start with fintechs and later banks, it aims to reach beyond financial services.

  • Current customers include Poshmark, Chime and SoFi, but Socure says 25 of its top 75 customers are outside fintech.
  • Berbix meanwhile brings in customers like crypto payment startup MoonPay, cannabis company Caliva, and scooter rental firm Spin.

Editor's note: This story has been corrected to note current customers include SoFi, not Soft.

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