HiddenLayer Raises $100M Series B as AI-Security ARR Jumps 10x

HiddenLayer, an Austin-based AI security startup, closed a $100 million Series B led by Delta-v Capital, with Ten Eleven Ventures, Morgan Stanley, Microsoft's M12 and Booz Allen Hamilton participating, TechCrunch reported.

Co-founder and CEO Chris Sestito told TechCrunch that annual recurring revenue grew more than 10x over the past year into the "tens of millions," with over 90% of that growth coming from new customers. One of them is described as a "leading frontier model provider" with "more than 700 million weekly users."

Sestito's pitch is that AI security keeps looking like the same problem in wider clothes. "Inference is still inference," he said. "So whether it's on a traditional machine learning model, whether it's Gen AI, whether it's an agentic work stream, a lot of our technology still applied." The platform spans discovery, runtime protection, attack simulation and supply-chain security, aimed at prompt injection, agent manipulation and malicious tool use.

The supply-chain piece is where the deadpan detail lands. "We parse and scan about 50 different AI file frameworks to make sure that, especially in the case of open-source, open-weight models, that the tool you're working with is the one you believe it to be, and it's the one it's purporting to be," Sestito said. He framed the threat as "hidden models inside of models."

Named customer segments include financial services, large tech companies building AI products, the Department of Defense and the intelligence community. TechCrunch does not name any specific enterprise buyer or disclose the round's valuation. HiddenLayer plans to put the capital toward sales, engineering and EMEA expansion. It lands on a busy day for AI-funding coverage on our tracker and joins a run of AI-security stories alongside CrowdStrike's SafeMind debut and OpenAI's disclosure that Astra crossed a 'critical' cyber threshold.