The recent $55 million funding round for Reco underscores a notable trend: AI agent security and SaaS application safety are now recognized as distinct investment categories. This latest capital injection, which includes backing from AT&T’s venture arm, reflects the growing demand from enterprises eager to secure their AI deployments amid a surge of activity in this area.
As more enterprises adopt AI agents, security concerns are escalating. Currently, at least two dozen companies are offering solutions aimed at improving AI agent security. Some vendors focus on vetting the tools used by these agents, while others prioritize controlling data access. Notably, companies like CrowdStrike and Zenity are developing detection and response mechanisms, along with tools to combat unauthorized AI usage.
Reco has been evolving to keep pace with this rapidly changing landscape. Until last year, the startup mainly provided software to map and secure SaaS and AI platforms. Now, it has broadened its offerings to include a solution that employs a context graph. This technology connects agents to applications, users, accounts, and permissions, allowing security teams to effectively monitor and restrict agent access.
According to Ofer Klein, Reco’s co-founder and CEO, the swift rise of AI agents prompted this shift in focus. He revealed that, at one Fortune 100 client, Reco identified 21,000 agents that the company was unaware of. In another instance, a financial services client discovered an agent set up by a former employee that had access to Salesforce data, posing a potential security risk.
Klein highlighted the current market demand, stating, “The market demand right now for agent security is not only about the agent itself; it’s about the entire ecosystem end-to-end.” This perspective aligns with observations from other security leaders. For example, Chris Sestito, co-founder of HiddenLayer, noted the rapid rise in costs and risks associated with AI agents once they are in production, mentioning that over 50 of his customers have AI agents interacting with critical systems and sensitive assets.
Further emphasizing the scale of the challenge, Cymphony reported discovering around 85,000 files accessible to AI tools and agents at one public company. As AI adoption accelerates, the need for effective security solutions becomes increasingly urgent.
The funding will be crucial for Reco as it expands its operations. With this latest investment, the total capital raised by Reco reaches $140 million. Klein mentioned that the company’s valuation has “more than doubled” since the Series B funding round earlier this year, which raised $30 million. He estimates the current valuation to be in the “high hundreds of millions.” Reco’s annual recurring revenue is now in the “double-digit millions,” with expectations to triple this year.
With over 100 customers, financial services companies account for about 40% of Reco’s client base. The company integrates with more than 280 applications, and Klein noted that new integrations can be established within days. The platform also utilizes browser and network signals to identify agents operating outside its direct connections, incorporating controls to inspect prompts and tool calls.
Reco’s evolution from securing SaaS platforms to implementing a context graph solution demonstrates a direct response to the rising number of unmonitored AI agents, a challenge highlighted by the discovery of thousands of potentially risky agents within major enterprises. As security concerns mount alongside AI adoption, the company’s ability to swiftly integrate new applications and monitor agent interactions positions it to address the urgent need for comprehensive security across the entire ecosystem.
