Venture Investors See Big Promise in AI-Native Cybersecurity Startups
Venture Investors See Big Promise in AI-Native Cybersecurity Startups
https://www.newcomer.co/p/venture-investors-see-big-promise
Publish Date: 2026-03-05 15:17:00
Source Domain: www.newcomer.co
As AI agents ramp up in the workplace, they’re opening the door to a lot of new cyber risks — and creating opportunities for a new wave of security startups, even as incumbents in the industry brace for disruption.
Some of the next-generation startups are using AI agents to significantly scale up how networks are monitored, either through penetration testing or governance — largely to beat back mass-scale automated attacks that are enabled by AI. Others are wrestling with the critical issue of how agents will verify their identities online as they begin to transact autonomously.
Investors are paying attention. Xbow, a Sequoia-backed penetration testing startup whose AI agents can probe networks around the clock, is in talks to raise a new funding round that investors expect to value it at just over $1 billion, according to multiple sources familiar with discussions. DFJ is expected to be a major participant in the round, per two of the sources. The round is not yet closed and terms could still change.
Just today, former Palo Alto Networks founder Nir Zuk announced a new AI-native cyber startup called Cylake, which is building hardware-based networks for customers whose data is too sensitive for the cloud, such as governments and defense contractors. The company raised a $45 million seed round led by Greylock.
Cogent Security, which is using agents to search for network vulnerabilities, raised a $42 million Series A two weeks ago led by Bain Capital Ventures, with participation from Greylock Partners and Definition. Another hot penetration testing company that investors told us about is RunSybil, which boasts co-founders from OpenAI and Meta.
Agents have been particularly useful at scaling up the capacity for network defense, said Vanta CEO Christina Cacioppo, whose compliance startup contracts with nearly a dozen AI security firms. “Because agents don’t get tired and don’t want vacation, you can fundamentally change the frequency of [testing.]”
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