A Cambridge-headquartered tech company which uses machine learning to help prevent fraud has raised £16.5m in a funding round led by venture capital firm Highland Europe.

Featurespace, which also has offices in London, New York and North Carolina, will use the investment to drive international growth and for the continued development of its software capabilities.

Described as a world-leader in adaptive behavioural analytics, Featurespace is the creator of the ARIC platform, a real-time, artificial intelligence-driven software system which monitors individual behaviours and detects anomalies to identify risk and catch new fraud attacks as they happen.

The business was created out of the University of Cambridge by Professor Bill Fitzgerald and Featurespace CTO Dave Excell.

Its software is used by gaming organisations and financial services including Playtech, Betfair, Camelot and William Hill.

"This funding round will enable us to continue to protect our expanding client base and their customers from real time fraud attacks,” Featurespace chief executive Martina King.

“These additional funds will also help support our continued international growth following the successful launch of our US offices earlier this year.”

Laurence Garrett, partner at Highland Europe, added: “Featurespace is one of the most exciting artificial intelligence companies we have seen, with huge potential for international expansion, since it offers one of the most advanced technologies in this area on the market.

“The demand for Featurespace's products is great and I am delighted that this funding will help support its rapid growth in the US and other international markets. Martina King is an exceptional leader and we are truly looking forward to working with her and the team.”

Global payment processing group Worldpay and Invoke Capital also participated in the funding round as new investors. The round also included additional funding from existing backers including Touchstone Innovations plc, NESTA, TTV Capital and Robert Sansom.

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