HiddenLayer Raises $100M as AI Security Spending Hits $2.83B
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HiddenLayer Raises $100M as AI Security Spending Hits $2.83B
The Austin startup's Series B, three years after a $50 million Series A, lands as Gartner tracks an 83% jump in 2026 enterprise AI-security budgets.
HiddenLayer's annual recurring revenue grew more than 10-fold in a year, and Gartner says enterprises will spend $2.83 billion in 2026 protecting AI systems most of them did not have two years ago.
The short version
- HiddenLayer raised a $100 million Series B led by Delta-v Capital, announced Sept. 2, 2026, three years after its $50 million Series A.
- Chief Executive Chris Sestito said annual recurring revenue grew more than 10-fold over the past year, with more than 90% of that growth from new customers.
- Gartner estimates enterprises will spend $2.83 billion in 2026 securing AI systems, 83% more than in 2025, rising to $4.78 billion in 2027.
Austin-based HiddenLayer raised $100 million in a Series B round led by Delta-v Capital, with Ten Eleven Ventures, Morgan Stanley, Microsoft's M12 and Booz Allen Ventures joining, the company said Sept. 2. The round follows a $50 million Series A the startup closed three years earlier, when, according to TechCrunch's coverage at the time, the open question in the field was whether attacks on AI systems would happen often enough to justify a real market.
That question has been answered by enterprise budgets rather than headlines. Sestito, HiddenLayer's co-founder and chief executive, told TechCrunch that annual recurring revenue grew more than 10 times over the past year to reach the "tens of millions" of dollars, and that more than 90% of that growth came from customers signing on for the first time. HiddenLayer's own announcement said it added more than 50 new platform customers in the period, including firms in banking, insurance, pharmaceuticals and the airline industry, plus government and defense and intelligence contracts.
What HiddenLayer actually sells
HiddenLayer builds tools to detect and stop adversarial attacks, data leakage and malicious code aimed at AI models, agents and the pipelines that ship them. Sestito said the core technology has not had to pivot so much as widen its scope: "Inference is still inference," he told TechCrunch, whether the workload is a traditional machine-learning model, a generative one or an autonomous agent. The new money funds a product called Agent Harness Security, which extends the company's runtime-protection module to cover AI coding agents that write and ship code with reduced human review.
One of HiddenLayer's customers, described in its own release only as a "leading frontier model provider," uses the platform to secure a service with more than 700 million weekly users, according to the company. HiddenLayer did not name the customer.
The market Gartner says grew 83% in 2026
Gartner estimates that companies will spend $2.83 billion in 2026 on products meant to secure AI tools, an 83% increase over 2025 spending, and forecasts that figure will reach $4.78 billion in 2027.
- 2026 (estimate)2.83 $ billions
- 2027 (forecast)4.78 $ billions
Source: Gartner, cited by TechCrunch, Sept. 2, 2026
HiddenLayer is not alone in chasing that budget line. TechCrunch named two adjacent startups, Noma and Zenity, that have each raised more than $100 million to secure overlapping parts of the AI stack, and said established security vendors including Cisco, Palo Alto Networks and Check Point tend to acquire this kind of technology rather than build it themselves.
| HiddenLayer funding | Amount | When |
|---|---|---|
| Series A | $50 million | 2023 |
| Series B | $100 million | Sept. 2, 2026 |
| Combined, two disclosed rounds | $150 million | — |
What the round does not settle
HiddenLayer's release did not disclose a valuation for the Series B, and the company has not said whether any of its point products could eventually be absorbed into the broader AI platforms built by Microsoft, OpenAI or AWS, a possibility Sestito himself raised in the TechCrunch interview. He said he expects those platforms to grow toward governance features such as identity and policy controls rather than the kind of adversarial-detection tools HiddenLayer builds, a distinction the next product cycle from any of those three companies will test. HiddenLayer said the new capital will go mostly toward sales and distribution as it expands into Europe, alongside continued engineering hiring, and the company also named Mike Gesnaldo as its chief revenue officer.
The same enterprise anxiety about AI agents borrowing a person's logged-in browser session or running with reduced human confirmation is what HiddenLayer is now selling a product against, rather than merely writing about.
Sources
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