Carding as a Startup: What Business Models and Growth Practices Are Successful Criminal Groups Using?

[Professor]

Abstract: In the public consciousness, carding is often portrayed as a chaotic scam or technical vandalism. However, having reached global proportions, this phenomenon has evolved into a highly organized branch of the shadow economy with its own logic, structure, and strategies. Successful carding groups operate not like gangs, but like startups: they seek a niche, optimize processes, scale, and compete for market share. This article offers an approach to this ecosystem through the lens of business analysis to understand the growth models and practices that have made it so resilient and effective.

Introduction: From Anarchy to Vertically Integrated Business​

While carding used to be the preserve of lone enthusiasts, today it's an industry with a clear division of labor. A typical "startup" in this field doesn't steal money itself. It creates a platform, product, or service that enables others to commit thefts more efficiently, safely, and on a larger scale. Its goal isn't a one-time haul, but rather building a sustainable criminal enterprise with a constant cash flow.

1. Business Models: From B2C to B2B in the Shadows​

1.1. Crime-as-a-Service (CaaS) — "Carding as a Service" (B2B2C)
The most widespread and scalable model. The group does not directly commit card fraud, but provides infrastructure and tools to other criminals.

• Products: Ready-made phishing kits, Telegram bots for dump sales, botnet rentals for mailings, cashout services.
• Monetization: Subscription (monthly fee for access to the panel), license fee, sales commission (revshare).
• Advantages: Low operational risks (the service provider is far from the point of theft), consistent revenue, scalability. Direct analogy with legitimate SaaS companies like Salesforce or Adobe.
• Example: The well-known Genesis Market service (closed by law enforcement in 2023) operated under this very model, selling access to victims' compromised browsers.

1.2. Marketplace model (B2C/C2C)
Creation and support of a trading platform where some sell stolen data (dumps, fulls) and others buy it.

• Product: The platform itself, its security, reputation system, escrow service, moderation.
• Monetization: Commission on each transaction (usually 2-5%), fee for "verified" seller status.
• Advantages: Network effect — the more users, the more valuable the platform. Control over the ecosystem. Direct analogy with eBay or Amazon.
• Example: Legendary platforms like Joker's Stash or modern decentralized stores on Telegram.

1.3. Vertically Integrated Model (B2C)
A classic, but riskier model. The group controls the entire value chain: from data collection (skimming, phishing) to final cashing.

• Structure: Within the group there are separate "departments": technical (hacking, malware creation), operational (drop management, product logistics), financial (cashing, money laundering through crypto).
• Monetization: All profits from fraudulent operations minus operating costs (salaries of droppers, purchase of domains, server rental).
• Advantages: Maximum marginality, complete control over the quality of the product and processes.
• Disadvantages: Maximum risks - failure at any stage leads to the failure of the entire operation and the possible exposure of the entire structure.

1.4. Franchising Model:
A successful group "packages" its proven model into a ready-made kit: brand (the whale's name), technology, instructions, and sometimes even advertising materials. Then it sells this franchise to regional "partners."

• Product: A business-in-a-box for fraud in a specific niche (for example, carding against clients of a certain bank in a certain country).
• Monetization: Lump sum fee + royalties (percentage of franchisee income).
• Analogy: Like McDonald's, but for cybercrime. Lowers the barrier to entry and accelerates geographic expansion.

2. Growth and Operational Efficiency Practices​

2.1. Agile Approach and MVP (Minimum Viable Product).
Successful teams don't create a perfect product on the first try. They quickly release a working version of a phishing kit or bot (MVP), test it in action, collect feedback from the first "clients" (other criminals), and quickly iterate: adding antivirus bypasses, improving the interface, expanding functionality.

2.2. Data-Driven Decision Making.
Effective teams work not on intuition, but on data. They analyze:

• Conversion: What percentage of those who opened the phishing email entered their data?
• Cost of attracting a "client": How much does it cost to advertise their whale on a forum?
• Geo-efficiency: Which countries and banks sell card data better and faster?
• Buyer LTV (Lifetime Value): What is the average amount a dumpster buyer will spend over their lifetime on the marketplace? Retention strategies are built on this basis.

2.3. Focus on User Experience (UX) and Customer Support.
Paradoxically, shadow markets are fiercely competitive. Therefore, successful projects invest in:

• User-friendly interface: A modern Telegram bot with buttons and menus is more pleasant than an archaic forum.
• Guarantees and escrow: To reduce the risk of scams and build trust.
• Technical support: Prompt answers to questions about using the kit via chat, help with setup, and sometimes even video tutorials.
• Loyalty programs: Discounts for regular customers, bonuses for attracting referrals.

2.4. Outsourcing and Partnership Programs
The Group focuses on its core competencies and outsources non-core tasks.

• Affiliate programs for affiliates: Criminals who promote their phishing kit or marketplace receive a percentage of sales. This is a powerful recruitment channel.
• Cash-out outsourcing: Working with independent "cash-out crews" that specialize in cash-outs, allowing the group to remain in the shadows.

2.5. Reputation Management and Branding
In anonymity, reputation is the most important asset. Successful "startups":

• Create a “brand”: A memorable name for a whale or store.
• Invest in "reviews": They actively work to achieve high ratings on forums.
• Fighting clones and counterfeits: Declaring war on those who try to copy their product or impersonate them – to protect market share and trust.

3. Risk management and exit​

Even a successful criminal startup thinks about risks.

• Operational Security (OpSec): Strict separation of roles, use of cryptography, one-time contacts - all these are direct analogues of corporate information security policies.
• Diversification: Don't rely on just one system or one region. If one bank or country closes, there are others.
• Exit Strategy: Having accumulated capital, founders may attempt to "go legit": moving into other, less risky forms of shadow business, investing in the legal sector through front men, or simply disappearing, living off their accumulated funds.

Conclusion: The Dark Mirror of the Digital Economy​

An analysis of carding through the lens of business models shows that it's not an aberration, but a logical continuation of the digital economy in the absence of a legal framework. The same laws of supply and demand, competition, and innovation apply here.

Successful criminal groups have prevailed not because they are "evil geniuses," but because they are effective managers and marketers. They realized that in the 21st century, the most valuable product isn't stolen money, but a platform that makes theft accessible, secure, and convenient for thousands of small-scale operators.