The 19 most promising cybersecurity startups of 2023, according to VCs
- We asked a select group of VCs to name the most promising computer security startups in 2023 so far.
- They told us about a range of startups and why these companies are poised for success.
- Also see: 73 of the most promising startups of 2023, according to top VCs
As long as our world relies on technology for everything — our jobs, homes, money, healthcare — there will be cyber criminals finding ways to exploit the digital world for their own gain.
Cybersecurity was a hot area of venture investment during the pandemic but VCs have slowed investment in information security as part of an overall slowdown. That has made this segment a hot area for acquisition by larger corporations. The number of acquisition deals in the second quarter this year are up by 50% compared to the first quarter, PitchBook data shows.
Those working in the cybersecurity industry are often well paid, too, with jobs ranging from $100,000 to $400,000, according to the University of San Diego. That makes this a necessary technology and a good career.
So, when we asked dozens of VCs at the most successful firms to name the most promising startups of 2023 so far as part of our annual Most Promising Startups project, quite a few were security startups. We asked the VCs to name startups that are in their portfolios and ones that aren't. All data about money raised to date is approximate and from PitchBook, unless otherwise noted.
Amount raised to date: $10 million
Investor: Ted Schlein, Ballistic Ventures
Investor's relationship: Investor in this startup
What it does: Alethea offers a service that detects digital disinformation, protects companies from being targeted and offers mitigation if they fall victim.
Why it's hot in 2023: "The weaponization of the open internet – including malicious disinformation, misinformation, and social media manipulation – is one of the biggest issues we'll have to deal with over the next few decades," Schlein said. "Alethea's machine learning SaaS platform conducts multichannel analysis across billions of data points to identify disinformation and manipulation at its start, before it takes hold."
He also said that founder and CEO Lisa Kaplan "is a force" and the four-year-old startup is starting to win some big customers.
Amount raised to date: $123 million
Investor: James Luo, CapitalG
Investor's relationship: None, not a portfolio company
What it does: AppOmni helps companies monitor the hundreds of cloud apps they use for potential misconfigurations or breaches.
Why it's hot in 2023: "SaaS applications are the new frontier of critical infrastructure for enterprises, and maintaining their security will only become more important," Luo said, adding that the startup's tech deeply integrates with software-as-a-service apps like Salesforce and ServiceNow, " which also contain an organization's most sensitive information."
Amount raised to date: $540 million, according to the company
Investor: Derek Zanutto, CapitalG
Investor's relationship: Investor in this startup
What it does: Armis sells a security platform that helps companies protect Internet of Things (IoT) devices from cyberattacks.
Why it's hot in 2023: "While the promise of IoT is reasonably well understood, enterprise adoption is far behind its full potential. Based on our conversations with industry leaders, the single biggest issue holding back larger scale IoT deployments is cybersecurity risk," said Zanutto. The startup attempts to address their concerns by helping them discover and identify all IoT devices connected to their network, identify threats, and automatically remove suspicious devices.
Amount raised to date: Undisclosed
Investor: Chengpeng Mou, CapitalG
Investor's relationship: None, not a portfolio company
What it does: Blockaid is a startup, still in stealth, working on application security for Web3 applications that rely on blockchain technology.
Why it's hot in 2023: "Web3 security is a well documented problem: attackers have stolen tens of billions worth of digital assets in the last few years. Lack of users' trust and safety has limited the potential and adoption of blockchain technology," said Mou, adding that he's impressed with the startup's vision, technology and leadership team.
Amount raised to date: $50 million, according to the company
Investor: Thomas Krane, Insight Partners
Investor's relationship: None, not a portfolio company
What it does: Chainguard examines and certifies that the software supply chain, bits of code developers will acquire from others as they write new software, is free from malware.
Why it's hot in 2023: "Modern software development is best characterized as the process of assembling ready-made components rather than building from scratch. While this leads to much faster development cycles, it also creates cyber exposure if downstream components have been compromised," said Krane.
Krane adds that Chainguard is taking "a novel approach" to this security issue. It allows developers to third-party and open-source software before using it themselves.
Amount raised to date: $14 million, according to the company
Investor: Sara Ittelson, Accel
Investor's relationship: Investor in this startup
What it does: Cinder is a platform for trust and safety operations, centralizing tasks like content moderation enforcement, policy management, investigations, and safety data labeling.
Why it's hot in 2023: "The work of trust and safety teams is too important to be supported by a patchwork of tools," said Ittelson. "In 2023 Cinder made massive strides in building its platform and proved it is a solution for scale, supporting many global customers with over tens of millions of daily active users."
Ittelson added that the tool can help companies adhere to the European Union's Digital Services Act, fend off AI and robotic threats and the team includes people from Meta's Trust and Safety team, Google, Match Group, and academia.
Amount raised to date: $53 million, according to the company
Investor: Guru Chahal, Lightspeed
Investor's relationship: Investor in this startup
What it does: Passwordless authentication and user management platform that makes adding and removing customer access to systems as easy as dragging and dropping.
Why it's hot in 2023: Founded in April last year, the startup "introduced the platform this year and is seeing amazing developer adoption out of the gate, simplifying a complex auth and user management landscape," Chahal said, referring to more than a dozen customers the startup lists on its website.
Amount raised to date: $62 million
Investor: Thomas Krane, Insight Partners
Investor's relationship: Investor in this startup
What it does: Quickly identifies and blocks malicious or inappropriate web traffic.
Why it's hot in 2023: "All cyber attacks have an origin point from the internet, and DNSFilter provides a critical first line of defense for cyber teams big and small to protect against attacks," Krane said. The investor added that the startup uses AI to help "identify malicious traffic sources before they can be used as a vector to compromise an organization."
Amount raised to date: $328 million
Investor: Oren Yunger, GGV Capital
Investor's relationship: Investor in this startup
What it does: Drata is a security platform that monitors computer security controls and helps companies automate the tasks needed for regulatory compliance and audits.
Why it's hot in 2023: "When GGV first invested in Drata, it offered compliance automation for SOC 2. Today, Drata stands tall as a complete product suite for automated GRC and trust," Yunger said, referring to governance, risk and compliance and the SOC standards for treating customer data. "The company works with thousands of companies to automate their security compliance posture," he added.
Amount raised to date: $70 million
Investor: Arif Janmohamed, Lightspeed
Investor's relationship: Investor in this startup
What it does: A code and application security platform that helps DevSecOps teams analyze security risks, including from open source software.
Why it's hot in 2023: Because modern software development often involves stitching together code taken from libraries, "software supply chain risk is rapidly becoming one of the highest priorities for CISOs and engineering leaders," Janmohamed said.
Amount raised to date: $25 million, according to the company
Investor: Asheem Chandna, Greylock
Investor's relationship: Investor in this startup
What it does: Kodem secures apps by analyzing the app's components, data and other elements in action. This reduces "false positives" — alerts that something is wrong when it's not — the bane of the security monitoring world.
Why it's hot in 2023: Kodem recently launched its product "which combines unparalleled runtime intelligence with deep code understanding to remove false positives and prioritize which vulnerabilities present true risk," Chandna said. "It's already being used by several customers across industries, including financial services, insurance and technology."
Amount raised to date: $23 million, according to the company
Investor: Avery Rosin, Lead Edge
Investor's relationship: Investor in this startup
What it does: Nucleus Security is a vulnerability management platform that aggregates vulnerability alerts from multiple sources like the network, devices, and application-level monitors, and prioritizes them based on how big a threat they are and other criteria.
Why it's hot in 2023: "Cybersecurity has remained a very important space with the growing need to spend time on the fraction of alerts that matter while tuning out the tremendous amount of noise," Rosin said. "Nucleus has been growing rapidly over the past few years, more than doubling every year, with many impressive enterprise accounts and a growing federal presence as well."
Amount raised to date: $7 million
Investor: Saam Motamedi, Greylock
Investor's relationship: None, not a portfolio company
What it does: Nudge discovers, inventories, and continuously monitors cloud accounts that employees create without requiring network changes, endpoint agents, or browser extensions.
Why it's hot in 2023: "Understanding and securing cloud and SaaS applications and assets is of utmost importance for enterprises. Nudge is helping improve cloud and SaaS security posture at companies like Watershed and the Portland Trail Blazers," Motamedi said.
Amount raised to date: $12 million
Investor: Saam Motamedi, Greylock
Investor's relationship: Investor in this startup
What it does: Opal is building an identity security platform that helps companies properly authorize employees access to cloud and SaaS cloud apps.
Why it's hot in 2023: "Opal is reimagining identity security with a data-centric approach," Motamedi said. Opal's tech "can visualize an enterprise's entire access and authorization graph, orchestrate intelligent policies, and remediate identity risk." It's grabbed some big name customers, too, like Databricks, Figma and Scale, he said.
Amount raised to date: $93 million, according to the company
Investor: Aydin Senkut, Felicis
Investor's relationship: Investor in this startup
What it does: Semgrep is a fast, open source analysis tool for finding bugs, detecting vulnerabilities in third-party dependencies, and enforcing code standards.
Why it's hot in 2023: "The company just raised a Series C based on its impressive revenue growth and incredible ability to ship meaningful products, like Semgrep Assistant, which uses AI to help automatically fix bugs in code, which makes organizations stronger. It also has a very strong following for its open source product and one of the most popular brands in security," Senkut said.
Amount raised to date: $97 million
Investor: Jake Storm, Felicis
Investor's relationship: Investor in this startup
What it does: Creates no-code automation workflows specific for security teams' needs such as processes for suspicious logins, or Slack bots or other common situations.
Why it's hot in 2023: "Tines is one of the only platforms that not only makes security teams more effective but also enhances the value of other security products around it. The Tines team has been on a roll releasing incredible features that CISOs and dev teams are eager to use," Storm said.
He added that the product works with AWS, Crowdstrike, Wiz, and other popular security apps and infrastructure services.
Amount raised to date: $34 million
Investor: Avery Rosin, Lead Edge
Investor's relationship: None, not a portfolio company
What it does: Todyl is a combined security and networking platform. By installing one bit of code on each device, called an agent, Todyl says it handles what multiple networking and security products do.
Why it's hot in 2023: "The need for unified platforms is especially important in today's environment where people have so many vendors," Rosin said. "Todyl has grown rapidly and will continue to see great success this year."
Amount raised to date: $36 million
Investor: Lonne Jaffe, Insight Partners
Investor's relationship: None, not a portfolio company.
What it does: Truepic's secure camera technology cryptographically captures, signs, and seals critical details such as date, time, location, and the true pixels captured to help validate the authenticity of photos and videos.
Why it's hot in 2023: "With the increasing adoption of generative AI technologies, it may prove to be easier to reliably verify the authenticity of human-generated content than it is to reliably detect AI-generated content," said Jaffe. This startup's approach is "similar to 'zero trust networking' in cybersecurity," he adds, meaning a prove-it-to-me type approach. "Truepic may become a key ingredient in enjoying the benefits of generative AI while mitigating some of the challenges," Jaffe added.
Amount raised to date: $203 million
Investor: Pejman Nozad, Pear VC
Investor's relationship: Investor in this startup
What it does: Vanta is a security platform helps companies achieve and maintain compliance with computer security standards.
Why it's hot in 2023: Vanta, which calls itself a trust management platform, "helps simplify and centralize security for organizations of all sizes," Nozad said, adding that it has thousands of users and in 2023, the company crossed the milestone of 5,000-plus customers in 58 countries.