New York-based cybersecurity startup Reco has raised $30 million in Series B funding as companies rapidly expand their AI use.
Ofer Klein, Gal Nakash, and Tal Shapira founded Reco in 2020 to fill the gap between a company’s existing cybersecurity protections and the other tech tools employees use, which is often AI.
“AI adoption has accelerated exponentially, and companies that blocked AI access a year ago cannot block it anymore,” Klein told Business Insider. “And I’m not talking about small mom-and-pop shops; I’m talking about the biggest banks, insurance, healthcare, pharma, and hospitals.”
Zeev Ventures led its latest round, with participation from all existing investors, which includes Insight Partners and Boldstart Ventures. New corporate investors for this round include Workday Ventures, TIAA Ventures, S Ventures, and Quadrille Capital.
“My investment strategy has always been to double down on what’s working,” Oren Zeev, the famed seed investor behind Zeev Ventures, said in a statement. “I’ve seen this pattern with successful companies like Navan and Tipalti, and I’m seeing it again with Reco. The signals we see show rapidly growing market demand for AI SaaS security, and we are experiencing exceptional growth.”
While software-as-a-service (SaaS) stocks have recently plunged amid concerns about AI disruption, Zeev sees a “massive” opportunity in AI for security.
After growing 500% year-over-year in 2024, Reco said it grew an additional 400% in 2025, driven by a sharp increase in business AI adoption.
Cybersecurity startups also raised nearly $14 billion in 2025, according to Pinpoint Search Group. That represented a 47% increase from 2024 and the most funding since 2021.
Klein said Reco began pulling in far larger companies than expected, repeatedly beating internal plans as AI went from blocked to mandatory.
“We built a plan, and we overachieved, and we updated the plan, and we overachieved again,” said Klein. “We said, ‘OK, enough is enough, let’s take more money and double down on AI SaaS.”‘
Klein said the biggest challenge for Reco now is keeping up with demand.
“The business is driving this huge traction into AI enablement,” he said. “Our biggest challenge right now: how we grow fast enough to meet this market need.”
Klein’s cofounders also bring in experience from working with the government. Nakash previously headed research at the Office of the Prime Minister of Israel, while Shapira holds a machine learning Ph.D. and also worked at Israel’s Office of the Prime Minister.
Reco faces competition from Torq, backed by Insight Partners and now valued at $1.2 billion, according to PitchBook. It also competes with Blackstone-backed Cyera, recently valued at $9 billion.
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