Reco raises $55M as AI agent security startups crowd the market

Cybersecurity startup Reco said on Tuesday it raised $55 million, building on a $30 million Series B from February and bringing total funding to $140 million. AT&T, which is also a Reco customer, invested through its venture arm, alongside Forestay and Quadrille Capital.

What Reco does

Until last year, Reco mostly sold software that maps and secures SaaS and AI platforms. It has since repositioned around a broader product that uses a context graph to connect agents to apps, people, accounts and permissions, giving security teams a way to see what an agent can reach and cut off access it does not need.

According to co-founder and CEO Ofer Klein, the biggest change over the past year was that companies build and deploy AI agents faster than they can track them. At one Fortune 100 customer, the platform found 21,000 agents the company did not know about. At a large financial services customer, Reco says it identified an agent set up by a former employee that could access Salesforce and share that data with a domain the company could not see.

A crowded market

The field is filling up quickly: public Crunchbase and PitchBook profiles list at least two dozen companies selling some form of AI agent security. Some vet the tools agents use, while others control what data agents can reach. CrowdStrike builds detection and response controls on the devices agents run on, and Zenity targets unapproved AI use. The products differ, but their promises to discover and govern agents sound alike.

Others stress the urgency. HiddenLayer co-founder and CEO Chris Sestito has said that when agents reach production, the scale of their costs and risk goes from theoretical to full scale really quickly, and that more than 50 of his customers run AI agents in production touching critical systems. Cymphony, another startup, said it found about 85,000 files that had become accessible to AI tools and agents at one U.S. public company.

Numbers and plans

Klein said the valuation has more than doubled since February, and estimated it in the "high hundreds of millions" without specifics. Annual recurring revenue is in the "double-digit millions of dollars", and he expects it to triple this year. The startup has more than 100 customers, with financial services accounting for about 40% of the business.

Reco integrates with more than 280 apps, and Klein says new ones can be added within days. The platform uses browser and network signals to find agents outside the apps it connects to directly, and includes controls to inspect prompts and tool calls. The new funding will go toward hiring, sales, partnerships and customer support.