HiddenLayer raises $100M Series B, a top-tier round for US AI security
What's the deal? HiddenLayer, an Austin-based startup that protects AI models, agents, and workflows from adversarial attacks and malicious code, has raised $100 million in a Series B round led by Delta-v CapitalDealroom has a profile for this one. Try Dealroom →. TenEleven VenturesDealroom has a profile for this one. Try Dealroom →, Morgan StanleyDealroom has a profile for this one. Try Dealroom →, Microsoft's M12, and Booz Allen HamiltonDealroom has a profile for this one. Try Dealroom → also participated.
How big is that? The round ranks in the 96th percentile of all US Series B deals in the AI security space, against a sample of 1,057 comparable rounds.
Why now? The market for AI security tools has exploded. GartnerDealroom has a profile for this one. Try Dealroom → estimates companies will spend $2.83 billion this year on products to secure AI tools — 83% more than 2025 — and forecasts nearly $4.78 billion next year.
The traction: Chief executive officer Chris Sestito told TechCrunch that annual recurring revenue grew more than 10x over the past year, now in the "tens of millions" of dollars. Over 90% of that growth came from new customers.
Financial services firms and large tech companies are its biggest verticals, alongside contracts with the Department of Defense and intelligence community. One customer is a "leading frontier model provider" with "more than 700 million weekly users."
What's the endgame? HiddenLayer has extended its products — discovery, runtime protection, attack simulation, and supply chain security — to address prompt injection, agent manipulation, and malicious tool use. Sestito likened runtime security to endpoint detection and response, but built for AI.
The company scans about 50 AI file frameworks to verify open-source and open-weight models are what they claim to be. "We're looking at things like models purporting to be one thing, but they're another — hidden models inside of models," Sestito said.
Where the money goes: The startup will focus the fresh capital on sales and distribution while expanding engineering and research. It also plans to move into Europe and EMEA.
The signal: Large vendors like Cisco, Palo Alto Networks, and Check Point tend to buy rather than build AI security tech. That leaves well-funded startups like HiddenLayer positioned as both competitors and acquisition targets as the sector matures.
Read more: TechCrunch
Image credit: HiddenLayer
