Digital fraud detection company BioCatch has a recent majority shareholder: a British private equity firm, Permirais acquiring a stake in the company “primarily” from existing investors, including Bain Capital, Maverick Ventures and Tech Opportunities, in a secondary market transaction that values BioCatch at $1.3 billion.
Existing shareholders Sapphire Ventures and Macquarie Capital are also increasing their stakes in BioCatch, although the firms didn’t say by how much. Permira also declined to verify how much of a majority stake it currently holds in BioCatch.
This is the second significant private equity deal announced in the cybersecurity space in lower than a week. Last Friday, Thoma Bravo said it plans to purchase Darktrace in a deal that may take the British cybersecurity company privately held for $5 billion.
Permira last 12 months acquired acquired a “significant minority stake” in BioCatch in a similar secondary market transaction with existing investors and became the company’s third shareholder after Bain and Maverick. According to him, BioCatch’s valuation has now exceeded the $1 billion mark to contemporary reportsmeaning that investors have since increased the valuation of the Israeli cybersecurity company.
Founded in 2011, Tel Aviv-based BioCatch develops technology that helps firms such as banks track users’ online behavior to find out whether a customer is real or a fraud. This may also help, for example, discover bots attempting to access online bank accounts using strategies such as “credential stuffing.”
To date, the company has raised well over $200 million, including tranches from financial giants such as American Express, HSBC, Barclays, Citi and National Australia Bank.
The deal represents one of Permira’s largest known acquisitions in recent years, dwarfed by the 2022 private deal in which Permira and Hellman & Friedman acquired Zendesk for $10.2 billion. Other notable deals include the $5.8 billion purchase of email security company Mimecast in 2021. I purchased Ergomed in November last 12 months for roughly $877 million.*
Permira says it is going to use its investment and position as majority shareholder to bring a “growth mindset” to BioCatch and plans further expansion in Europe.
“Permira has been supporting the topic of cybersecurity for several years, including a clear focus on online fraud detection, customer identity management and access management markets,” said Stefan Dziarski, partner and co-head of Permira Growth Opportunities press release. “We have followed BioCatch with enthusiasm for many years, and now that we have been shareholders since early 2023, our confidence in the company, its growth potential, technology leadership and management team continues to grow.”