Investigations and Disputes Secure $300 Million Investment for Quavo
Quavo Secures $300 Million Investment to Drive AI-Led Growth in Fraud and Dispute Management
Quavo Fraud & Disputes, a leading provider of cloud-based solutions for financial institutions, has secured a $300 million investment from Spectrum Equity. This investment will accelerate Quavo's AI-led product development initiatives and expand its go-to-market and client success teams to meet the growing demand in the fraud and dispute management sector.
Quavo's platform automates up to 80% of tasks involved in resolving consumer disputes, using AI-driven technology that handles intake, investigation, chargeback, recovery, and client communications across all payment and dispute types. The platform's sophisticated decisioning engine is powered by scaled transaction data, and it integrates with a comprehensive library of third-party APIs.
With this investment, Quavo aims to strengthen its fully managed service offering, Dispute Resolution Experts (DRE), which combines AI technology with expert dispute management for clients preferring not to handle disputes in-house. The funds will also be used to accelerate innovation in AI-based dispute management technology and scale the workforce, particularly in client success and market expansion.
Quavo serves a broad client base, including global issuers, fintechs, regional banks, and credit unions, processing over 12.5 million consumer disputes annually. The investment will enable the company to recapture approximately 85% of potentially lost disputed funds for financial institutions, providing significant operational efficiencies. These include a 37% reduction in write-offs and a reduction in time to issue consumer credit from 11 days to less than one day.
Quavo's annual revenue growth has been 60% since 2022, reflecting the company's rapid growth and market leadership in end-to-end dispute management. The investment round was led by Spectrum Equity, with Pegasystems, Quavo's co-founder and strategic investor, continuing as a significant shareholder. Existing investor FINTOP Capital will sell its ownership stake in Quavo Fraud & Disputes.
The quality of the fraud resolution process, as revealed by Quavo's Q4 2024 Consumer Survey, has a greater impact on trust than the actual fraud itself. The fraud resolution experience also has a ripple effect on customer trust in other banking services. Quavo published a report showing the impact of fraud resolution on customer loyalty in Q4 2024.
McLean, Quavo's CEO, stated that "Trust is a bank's most valuable asset, and fraud resolution is a defining moment in the customer relationship." Quavo made its platform debut at platformFall 2024 in New York and returned to the platform stage the following year for platformSpring in San Diego.
Quavo Fraud & Disputes is headquartered in Wilmington, Delaware. The company's highly configurable platform, scaled transaction data powering its decisioning engine, and mission-driven approach set it apart in the industry. With this significant investment, Quavo is poised to expand its market presence and product capabilities significantly, enhancing efficiency, reducing financial losses, and improving outcomes in consumer dispute resolution.
Quavo's investment of $300 million from Spectrum Equity indicates a strong focus on technology within the business sector, particularly in the finance industry. This funding will drive growth and innovation in the AI-led product development for fraud and dispute management.
With the aim to strengthen its existing AI-based dispute management technology and scale its workforce, Quavo aims to Meet the growing demand in the fraud and dispute management sector, providing significant operational efficiencies for its clients.
