Observed Signal · Sep 2, 2026 · Funding · Source: techcrunch · Impact: 3/5 · Sentiment: Positive
HiddenLayer raises $100M for enterprise AI security
AI security startup HiddenLayer has raised $100 million in a Series B round led by Delta-v Capital, with participation from Ten Eleven Ventures, Morgan Stanley, Microsoft's M12, and Booz Allen Hamilton. The Austin-based company protects AI models, agents, and workflows from adversarial attacks, vulnerabilities, and malicious code injections. CEO Chris Sestito said annual recurring revenue grew more than 10x over the past year and now stands in the 'tens of millions' of dollars, with over 90% of growth driven by new customers. HiddenLayer has expanded its product scope from traditional machine learning to generative AI and agentic systems, addressing prompt injection, agent manipulation, and malicious tool use. Gartner estimates companies will spend $2.83 billion on AI security products in 2026 and nearly $4.78 billion in 2027. The new capital will support sales, distribution, engineering, and expansion into Europe and EMEA.
A $100M Series B for a leading AI security vendor highlights the fast-growing market for securing AI and agentic deployments, which underpins increasingly AI-driven advertising and marketing infrastructure.
Key Takeaways & Evidence Grounding
- HiddenLayer raised $100 million in a Series B funding round led by Delta-v Capital.
- Participants included Ten Eleven Ventures, Morgan Stanley, Microsoft's M12, and Booz Allen Hamilton.
- HiddenLayer's annual recurring revenue grew more than 10x over the past year and is now in the tens of millions of dollars.
- Gartner forecasts AI security spending will reach $2.83 billion in 2026 and nearly $4.78 billion in 2027.
- HiddenLayer plans to expand into Europe and EMEA with the new funding.
Connected Companies & Entities
8 Entities mappedCisco
Enterprise networking, security and collaboration software and infrastructure provider.
“Large cybersecurity companies, like Cisco, Palo Alto Networks, and Check Point often prefer to buy rather than build this sort of tech....”
Palo Alto Networks
Enterprise cybersecurity platform for network, cloud and security operations.
“Large cybersecurity companies, like Cisco, Palo Alto Networks, and Check Point often prefer to buy rather than build this sort of tech....”
Microsoft
Diversified software, cloud, advertising and gaming platform company.
“The startup has now raised $100 million in a Series B funding round that was led by Delta-v Capital, with participation from Ten Eleven Vent...”
Delta-v Capital
Investor / PEGrowth equity investor in later-stage software companies.
“The startup has now raised $100 million in a Series B funding round that was led by Delta-v Capital, with participation from Ten Eleven Vent...”
OpenAI
Foundation model company selling AI software, APIs and subscriptions.
“Sestito acknowledged that some parts of the AI security products his company offers could eventually be bundled into the platforms built by ...”
Morgan Stanley
Global bank and wealth manager serving institutions and investors.
“The startup has now raised $100 million in a Series B funding round that was led by Delta-v Capital, with participation from Ten Eleven Vent...”
Gartner
Research and advisory firm for enterprise technology and business leaders.
“Gartner estimates companies will spend $2.83 billion this year on products meant to secure AI tools, 83% more than 2025, and expects spendin...”
Amazon Web Services (AWS)
Cloud infrastructure, platform and AI services for enterprises and developers.
“Sestito acknowledged that some parts of the AI security products his company offers could eventually be bundled into the platforms built by ...”
Ontology Mapping & Concepts
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