Quavo, a US-based provider of automated fraud and dispute management solutions for financial institutions, has raised $300m in growth capital to support its expansion and product innovation efforts.
The funding comes from Spectrum Equity, a growth equity firm. As part of the transaction, existing investor FINTOP Capital will exit its stake, while Quavo’s co-founders and strategic investor Pegasystems will remain significant shareholders.
Founded in 2016 by former Bank of America technologists Joseph McLean, David Chmielewski, Daniel Penne, and Richard Jefferson, Quavo offers cloud-based software that automates the full dispute lifecycle—from intake and investigation to chargeback, recovery, and client communication. Its flagship platform, QFD, is used by banks, credit unions, and FinTechs to resolve consumer transaction disputes across all payment methods and dispute types, while ensuring regulatory compliance.
The $300m investment will enable Quavo to accelerate development of its AI-powered decisioning engine, expand its go-to-market strategy, and scale up client success teams.
Quavo’s technology enables clients to automate roughly 80% of dispute-handling tasks and reclaim around 85% of potentially lost funds. On average, institutions using the platform see a 37% drop in write-offs and reduce the time taken to issue credit from 11 days to under one.
In 2022, the company began posting annual revenue growth of 60%. It now processes over 12.5m disputes each year for a diverse range of institutions—from global issuers to community banks.
Quavo CEO Joseph McLean said, “We are thrilled to be partnering with Spectrum Equity on the next chapter of growth at Quavo.
“With this new investment, we intend to accelerate our AI-led product development initiatives and expand our go-to-market and client success teams to meet growing market demand and drive exceptional client outcomes. Our vision to restore financial trust and simplify fraud and disputes is unwavering, and this partnership allows us to achieve these goals faster and at even greater scale.”
Spectrum Equity managing director Adam Margolin said, “Fraud and dispute management is a massive business-as-usual problem for financial institutions and fintechs alike, and we believe that Quavo is uniquely positioned to drive automation benefits and better outcomes in this space.
“Quavo’s highly configurable platform, scaled transaction data powering its decisioning engine, and mission-driven approach to solving costly and time-consuming problems for its clients set the company apart. We couldn’t be more excited by the opportunity to back Joe and the rest of the Quavo team going forward.”
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