Israeli AI startup tracking fake news plans to list on Nasdaq at $70 million valuation

Israeli software platform Cyabra, which tracks fake users and accounts on social media to root out disinformation, on Tuesday announced plans to list its shares on Nasdaq via a merger with a special purpose acquisition company (SPAC), in a transaction that values the startup at $70 million.

The Tel Aviv-based company said it has entered into a definitive agreement for a business combination with Nasdaq-listed Trailblazer Merger Corporation. Upon closure of the transaction, which is expected in the fourth quarter of 2024, Cyabra will be publicly listed to trade on the Nasdaq exchange.

The startup’s expansion plans come as the World Economic Forum has ranked AI-driven misinformation and disinformation as its top global risks amid elections in several major global economies taking place over the next two years and as bad actors are increasingly exploiting online platforms.

In recent months, the unprecedented events of October 7 by the Hamas terror group brought to the surface more profoundly a wave of terror using the power of social media to aim at victims’ loved ones, harm Israelis, and reach millions of viewers online in the Middle East and around the world. In an analysis of Hamas’s social media warfare, Cyabra found that about 41,000 fake accounts have been pushing pro-Hamas narratives on social media platforms, spreading propaganda, disinformation, and fake news online to manipulate public discourse.

The emergence of sophisticated AI tools being used by malicious actors to create bots and automate the distribution of fake news has blurred the line between real and fake. The fast and wide-reaching dissemination of disinformation has been undermining trust in brands, individuals, communities, and democratic institutions.

Cyabra founded in 2018 by CEO Dan Brahmy, CPO Yossef Daar, and CTO Ido Shraga – all veterans of elite military Israeli intelligence units – said that over the past year, it has worked with 19 governments around the world in the Middle East and Asia Pacific, coping with disinformation campaigns that have meddled in elections, as well as with large consumer and media brands such as Warner Media, to help them track disinformation efforts and detect fake accounts on social media platforms. These include Facebook (Meta), X, Instagram, TikTok, Russian platform VK, and Telegram’s public groups.

Israeli startup Cyabra’s software platform harnesses machine learning algorithms to detect fake accounts, as well as malicious actors, bot networks and GenAI content on social media. (Courtesy)

“There’s something truly remarkable in being among the first, if not the first publicly traded company that will be solely driven by solving disinformation,” Brahmy told The Times of Israel. “We can not wait as the problem is too big.”

“This year alone, you have a few billion people that are getting into the elections process around the world as disinformation is posing the biggest threat out there,” he remarked.

Brahmy recounted that the startup back in 2018 was established to create a “filtering mechanism that is able to distinguish between the good, the bad, and the fake.” Since then, the startup has built a platform harnessing “AI for good” to combat “malicious AI” and to uncover fake profiles, and harmful narratives created by AI-generated fake content and GenAI tools.

Brahmy described Cyabra’s platform, as a “search engine,” driven by machine learning algorithms that can yield insights into conversations to detect disinformation, and determine influence and reach.

“It works like a search engine that you can feed with keywords, hashtags, brand names, products, and so on,” Brahmy said. “It acts like a CT scan is used before deciding about surgery to make sense of who the actors are and what their intention is, which relies purely on machine learning algorithms that we have developed.”

“We have corporate customers and governments worldwide using our product today to identify when an attack is occurring, providing them with the information needed to mitigate or even prevent any damage and protect their citizens and brands from the increasingly sophisticated spread of disinformation,” he added.

Fake News logo. (Illustrative: iStock)

Back in 2022, Tesla and SpaceX chief Elon Musk hired Cyabra as part of his acquisition battle for social media platform Twitter, now known as X, to commission an analysis that found that 13% of the accounts on the social media platform are inauthentic or fake.

In the most recent analysis report, Cyabra found that following the announcement of US President Joe Biden’s withdrawal from the US presidential election race, a significant amount of fake accounts were proliferating on X as part of a coordinated campaign to promote former US President Donald Trump. The analysis revealed that 29% of the profiles commenting on Biden’s tweet were fake.

To date, Cyabra has raised a total of $16 million from investors including, the Founders Fund, OurCrowd, Red Forest Ventures, Summus Group, Tel Aviv University Ventures. The startup has 45 employees, the majority working at its Tel Aviv office and five at its New York office.

“Cyabra’s efforts are not only safeguarding our digital realm, but also strengthening the foundations of free and fair discourse,” stated former US Secretary of State and former director of the CIA Mike Pompeo, who joined Cyabra’s board in January. “Cyabra’s contributions are invaluable in the fight against malicious actors who seek to undermine our democratic institutions.”

Brahmy said the startup plans to use the “substantial amount” in funds it seeks to raise from the Nasdaq IPO to help grow the company and the product to answer the demand for its technology, which he described as “fairly big at this point.”

“There’s a genuine intent to grow within the North American market, both on the corporation side and the government side,” said Brahmy. “We look to expand the team within the next six to 12 months to add north of 20 to 30 people.”