Pinch AI Raises $5M, Co-Led by Dynamo and Infinity Ventures to Give Retailers an AI Defense Against Exploding Return Fraud

SAN FRANCISCO, Jan. 15, 2026 /PRNewswire/ -- Pinch, the AI-powered post-purchase intelligence platform that helps retailers reward loyal customers and prevent return fraud, announced a $5 million total seed round. The seed round was co-led by Dynamo Ventures and Infinity Ventures with additional participation from Defined Capital and PayPal Ventures.

Built by fraud and risk leaders from PayPal, Google, and Simility, Pinch was born out of a simple realization: retail was fighting modern return abuse with blunt, static policies that hadn't evolved. After two decades of building fraud and risk systems that protected billions in global payments, Arthi Rajan Makhija, Co-Founder and CEO, saw the same pattern emerging in e-commerce returns. Together with Co-Founders Chirag Vaya (CPO) and Jayan Tharayil (COO), she assembled a team of former PayPal, Google, and Simility leaders to launch Pinch AI, the industry's first post-purchase risk operating system. The autonomous, AI-driven platform evaluates customer intent, detects emerging abuse patterns, and dynamically orchestrates return and refund decisions across checkout, return initiation, and warehouse operations, giving retailers the intelligence to protect margins without punishing loyal customers

Average e-commerce return rates hover around 25%, with apparel and luxury often seeing even higher rates, creating a major drag on margins and growth. Pinch delivers two clear outcomes for retailers:

• ~8% reduction in return rate, by identifying and proactively denying only abusive returns or applying graduated interventions to high-risk behavior.
• ~20% increase in VIP retention, by dynamically improving the return experience for a brand's most loyal customers - protecting trust while driving repeat purchases.

The result is fewer bad returns, stronger customer relationships, and a measurable improvement to both margins and lifetime value. Pinch enables retailers to turn returns from a cost center into a growth lever.

"Traditional return systems rely on blunt policies, manual investigations, and guesswork that treat every shopper the same by rewarding bad actors and frustrating loyal customers," said Arthi Rajan Makhija, CEO & Co Founder.  "Abusive behaviors like wardrobing, empty-boxing, counterfeit swaps, and FTID fraud are surging, yet most retailers have no unified view of post-purchase risk. We built Pinch to give retailers an intelligent operating system that continuously learns, adapts, and intervenes in real time. Our platform identifies the abusive 1% without penalizing the loyal 99%, allowing brands to boost margins while actually improving the customer experience."

Pinch's technology is already delivering a measurable impact for enterprise retailers. A North American premium apparel brand using Pinch reduced overall returns by 8%, driving a 10% lift in contribution margin by proactively identifying and intervening on abusive behaviors such as wardrobing, empty boxing, and SKU swapping. Pinch also automated 80% of return reviews end-to-end, freeing up valuable operational capacity while enabling instant refunds and elevated return experiences for trusted VIP customers, resulting in a 20% increase in VIP retention.

"While many fraud vendors try to force-fit return and policy abuse into platforms built for other use cases, Pinch built its solution from the ground up for this specific problem, and it shows," says Rohit Nathany, Chief Product & Technology Officer, Mejuri. Their native Shopify integration meant we could move fast, but what really differentiated them was their customer-first approach, giving us the flexibility to block fraudulent activities while actually enhancing the experience for our most loyal customers. That combination of focused expertise, purpose-built technology, and true partnership is rare to find."

"From the beginning, it was clear this team had the domain expertise and technical depth to solve a problem retailers have struggled with for years," said Jon Bradford, Managing Partner at Dynamo Ventures. "They've lived inside the fraud infrastructure of major global platforms and understand how fragmented post-purchase data creates blind spots that erode margins. Pinch is a full-stack intelligence layer that unifies signals for cross-checkout, returns, and warehouse operations. The early traction with enterprise retailers has been extraordinary, and what the team has built in such a short time is exceptionally impressive."

"Having worked alongside Arthi, Jayan, and Chirag since our PayPal days, I can say firsthand that you couldn't assemble a better team to solve this problem for merchants," says Jay Ganatra, Managing Partner, Infinity Ventures. Their rare combination of risk and fraud expertise and customer-first thinking is what sets Pinch apart and why we believe it's the best product in the market."

With the new funding, Pinch will accelerate product development across its abuse prediction models, warehouse intelligence systems, and adaptive return engine; expand its go-to-market efforts; and expand its integration ecosystem across the full retail technology stack, including order management systems (OMS), return management systems (RMS), warehouse management systems (WMS), and customer experience (CX) platforms.

About Pinch AI
Pinch is an AI-powered post-purchase intelligence platform redefining how retailers control returns, refunds, and customer trust. Built by industry veterans who previously built PayPal's trust and safety ecosystem ground up, Pinch delivers real-time buyer intent scoring, automated policy enforcement, and warehouse intelligence that helps merchants protect margins while elevating the customer experience. To learn more, visit pinch.ai.

SOURCE Pinch AI Corp.