Israeli fraud detection software start-up FraudSciences Corp. has been acquired by eBay Inc. (Nasdaq: EBAY) subsidiary PayPal for $169 million. FraudSciences, which was founded in 2001, raised $7 million from BRM Capital, which holds a 40% stake, angel investor Guy Gamzu, and Redpoint Ventures of the US. The company, which had its first sales at the end of 2006, will remain in Israel and become PayPal's local R&D center.
FraudSciences began marketing its products about a year ago. The company was founded by chief scientist Saar Wilf and CTO Shvat Shaked. Wilf was formerly CFO at online payment solutions provider Trivnet Ltd. and has extensive experience in the field. Shaked, also a former Trivnet executive, is an expert in e-commerce, web-based information security, and software and telecommunications systems. He owns patents on a series of user identification, electronic payment, and fraud detection technologies. Both founders were also in classified technology divisions in the Israeli army.
Wilf and Shaked said today that "we have been given a rare opportunity to work with an exceptional group of talented people."
Sources inform ''Globes'' that Wilf and Shaked will collect $20 million each following the acquisition. BRM has also made a handsome twelve fold return on its investment making almost $70 million on an investment of $5 million.
BRM managing director Eli Barkat declined to comment.
Published by Globes [online], Israel business news - www.globes.co.il - on January 28, 2008
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