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Portico Capital Advises Kount on a Major Investment from CVC Growth Partners

December 16, 2015
Greenwich, CT

Portico Capital is pleased to announce that it has served as the exclusive financial advisor to Kount Inc. on its majority recapitalization with CVC Growth Partners.  “We are pleased to have worked with Kount, a leader in the card-not-present fraud prevention space, on this significant transaction,” noted Rick Northrop, Managing Partner at Portico Capital. “With the addition of CVC as a strong, global partner, Kount is poised to accelerate its already impressive growth and momentum.” Tony Seto, Director at Portico Capital, added “Kount’s award-winning solutions have positioned the Company as a market leader by combining a comprehensive scoring platform with proprietary fraud technologies to provide merchant clients and payment processor partners with superior accuracy, reliability and performance.

Below are more details from the Company's press release:

CVC Capital Partners' Growth Fund Makes $80 Million Investment in Kount Inc.

The CVC Growth Fund’s second investment will accelerate Kount’s product innovation and expand its global footprint as a leading provider of online fraud prevention solutions

Boise, ID and New York – Kount Inc. (“Kount”) and CVC Capital Partners (“CVC”) announced today that the CVC Growth Fund will provide an $80 million growth equity investment to Kount, a leading provider of online and mobile fraud detection and prevention solutions. The investment will enable Kount to accelerate product innovation, expand its global footprint, and enhance customer support services.

Based in Boise, ID, Kount provides cloud-based fraud detection solutions that enable merchants to reduce fraudulent transactions made online and via mobile while increasing revenue by accepting more valid orders. Kount eliminates or reduces manual reviews of potentially fraudulent transactions for its customers, reducing credit card chargebacks, improving customer satisfaction, and drastically reducing fraud, in many cases by more than 90 percent.

Kount works with a number of sectors, including retail, financial services, and gaming, touching billions of transactions and devices every year. Its end-to-end solution is used by thousands of merchants, payment processors, and payment service providers around the world, including Chase Paymentech, PayPal-owned Braintree, New Balance, Spotify and Bodybuilding.com. Kount owns its own proprietary technology and holds dozens of patents in the space.

“Online merchants face greater fraud challenges than ever before,” said Brad Wiskirchen, CEO, Kount. “CVC’s funding and strategic guidance will provide Kount with significant resources to continue investing in our industry-leading fraud prevention solutions and to deliver the tools our customers need to combat fraud every day. We’re excited to partner with CVC in our next stage of growth as we continue to develop the industry’s most effective and efficient online fraud prevention solution.”

The industry is poised for growth as recent reports anticipate that the fraud detection and prevention industry will expand from $9 billion to over $21 billion in 2019. Furthermore, the 2015 Mobile Payments & Fraud Survey found that many organizations are not keeping pace with mobile fraud growth, as over half (60%) of respondents are uncertain if mobile fraud is growing at a faster, slower or equal pace as their overall mobile transaction volume.

“The payments fraud and security industry is one that we have been actively targeting for a while, and we identified Kount as the obvious industry leader,” said Jason Glass, Managing Director at CVC Growth Partners. “Kount’s long track record of success in a rapidly expanding market will become even more critical to merchants and payment processors as mobile and internet commerce grows.”

“This investment is perfectly aligned with CVC Growth Partners’ strategy of partnering with uniquely positioned technology companies in large, growing markets,” added John Clark, Managing Partner at CVC Growth Partners. “We are very pleased to work alongside Brad and his team to build on Kount’s success to date.” The investment in Kount is the second made from the CVC Growth Fund, following an investment in Wireless Logic in February 2015.

Portico Capital Securities LLC served as exclusive financial advisor to Kount with respect to this transaction.

About Kount
Kount helps businesses boost sales by reducing fraud. The company’s all-in-one, SaaS platform simplifies fraud detection and helps online and mobile businesses accept more orders. Kount’s turnkey fraud platform is easy-to-implement and easy-to-use. Kount’s proprietary technology reviews billions of data points and provides maximum protection for some of the world’s best-known brands. Merchants using Kount can accept more orders from more people in more places than ever before. For more information about Kount, please visit www.kount.com.

About CVC Capital Partners
CVC Capital Partners is one of the world’s leading private equity and investment advisory firms. Founded in 1981, CVC today has a network of 24 offices and over 300 employees throughout the U.S., Europe, Asia, and South America. To date, CVC has secured commitments of over US$79 billion in funds from a diverse and loyal investor base, completing over 300 investments in a wide range of industries and countries across the globe, with an aggregate transaction value of over US$120 billion. For more information please visit www.cvc.com.

About CVC Growth Partners
In 2014, CVC formed a new team to target smaller growth-oriented companies through its dedicated CVC Growth Fund.  The fund focuses on middle-market, high-growth comanies in the software and technology-enabled business services sector.  The fund primarily tarets equity investments between $50mn and $300 mn in North America and Europe.  The CVC Growth Fund's investment in Kount is the fund's second investment, following its investment in Wireless Logic in February 2015.

About Portico Capital Securities
Portico Capital provides independent strategic and financial advisory services in the areas of mergers & acquisitions (M&A), recapitalizations and capital raisings exclusively to private and public companies in the global information and business services/software sector.  The firm, founded in 2000, has offices in Greenwich, Connecticut and London, England.  For more information, please visit www.porticocapital.com.

PORTICO CONTACT
Richard R.S. Northrop, Managing Partner
rick@porticocapital.com
203.661.7702