HiddenLayer Raises $100M Series B to Secure Enterprise AI Deployments

HiddenLayer, an Austin-based AI security company, has raised $100 million in Series B funding as enterprises accelerate the deployment of AI models, agents and autonomous workflows.

The round was led by Delta-v Capital, with participation from Ten Eleven Ventures, Morgan Stanley, M12, Microsoft's venture fund and Booz Allen Ventures. The funding will help HiddenLayer expand its AI security platform, strengthen its agentic runtime protection capabilities and accelerate its international growth.

HiddenLayer Raises $100M Series B

Founded in 2022 by Chris Sestito, Tanner Burns and Jim Ballard, HiddenLayer develops cybersecurity technology designed specifically for artificial intelligence systems.

The company's co-founder and CEO, Chris Sestito, said HiddenLayer's annual recurring revenue has grown more than 10x over the past year and is now in the tens of millions of dollars. More than 90% of that growth came from customers acquired during the last year.

The company counts financial services firms and large technology companies building AI products among its largest customer segments. It also has contracts with the U.S. Department of Defense and the intelligence community.

Securing AI Models and Agents

HiddenLayer's platform protects AI systems across several stages, including discovery, AI supply chain security, attack simulation and runtime protection.

As enterprises increasingly deploy AI agents into production environments, the company has expanded its technology to address threats such as prompt injection, agent manipulation and malicious tool usage.

Sestito said the company did not need to fundamentally change its technology as AI evolved from traditional machine learning models to generative AI and agentic systems. Instead, HiddenLayer expanded the scope of its existing security capabilities.

Runtime Security Becomes a Priority

One of the company's biggest areas of focus is runtime security.

As AI agents gain the ability to interact with business systems, databases and external tools, enterprises need visibility into what those systems are doing while they operate.

HiddenLayer compares its AI runtime security capabilities with traditional endpoint detection and response tools, but designed specifically for AI environments.

The company is also developing technology to protect AI coding agents as autonomous software development becomes more common.

Protecting Open-Source AI Models

Open-source and open-weight AI models create another security challenge because organizations may not always know whether a model is exactly what it claims to be.

HiddenLayer says it can scan around 50 different AI file frameworks to identify potentially manipulated or malicious models.

The company looks for cases where models may contain hidden components or differ from what they are advertised to be, helping enterprises assess the integrity of AI assets before deploying them.

Growing Enterprise Demand

The rapid adoption of AI is creating a much larger security market.

Gartner estimates that global spending on products designed to secure AI tools will reach billions of dollars as enterprises increasingly integrate AI into their operations.

HiddenLayer says it has benefited from this shift, with customer demand accelerating across regulated industries and technology companies.

The company also counts a major frontier AI model provider with more than 700 million weekly users among its customers, according to the company.

Competition Intensifies

HiddenLayer is operating in an increasingly competitive AI security market.

Startups such as Noma Security and Zenity have raised more than $100 million to address adjacent areas including AI agent security, governance and runtime protection.

Large cybersecurity companies including Cisco, Palo Alto Networks and Check Point are also investing in or acquiring AI security technology.

HiddenLayer believes its advantage comes from having developed AI-specific security technology before the current wave of enterprise AI adoption.

Plans for the New Capital

HiddenLayer will use the $100 million Series B primarily to expand sales and distribution while continuing to invest in engineering and AI security research.

The company also plans to expand its presence across Europe and the broader EMEA region.

With AI agents moving deeper into enterprise workflows, HiddenLayer is positioning itself as a security layer designed to protect AI systems from development through deployment and runtime.