- Rome’s Exein raised $270 million at a $1.7 billion valuation, becoming one of Europe’s most valuable cybersecurity startups.
- The Series C, led by Headline, funds a foundation model trained on machine telemetry and autonomous agents that respond to attacks without a human in the loop.
- Exein’s valuation has climbed 30-fold in two years, and its first-half 2026 annual recurring revenue was four times higher than a year earlier.
When a laptop gets hacked, someone’s data leaks. When a robot arm, a drone, or a car gets hacked, someone can get hurt. That distinction is the business Exein has built. The Rome-based company has raised $270 million in a Series C round led by Headline at a $1.7 billion valuation, making it, by its own count, one of the most valuable cybersecurity startups in Europe.
Sofina, Goldman Sachs, the European Investment Bank Group through the European Tech Champions Initiative, KfW Capital, and T.Capital joined as new backers, alongside returning investors Balderton, HV, Intrepid Growth Partners, 33N Ventures, Lakestar, Supernova Invest, Blue Cloud Ventures, and Geodesic Capital. Exein says the round was oversubscribed.
Founder and chief executive Gianni Cuozzo frames it as the moment the company was built for: “AI is moving out of the cloud and into the physical world, and this is the transition Exein was built for… Frontier models are pushing the patch window to zero. Attacks now happen at machine speed, so defense has to as well. Physical AI is the natural next step for Exein: we’re building machine-time security for machine-time attacks.”
From firmware to physical AI
Founded in 2018, Exein started by embedding cybersecurity code directly onto IoT devices rather than guarding them from the network.
That approach now runs across more than two billion connected devices in industrial automation, automotive, energy, healthcare, semiconductors, aerospace, and robotics. Its Photon platform works at the kernel level, aiming to block malicious code before it executes rather than clean up after the fact.
The funding history shows how fast that scaled. Exein raised €15 million in a Series B in July 2024, led by 33N. A year later, in July 2025, it closed a €70 million Series C led by Balderton, with Supernova Invest and Lakestar joining. Five months later, in December 2025, it added another €100 million, led by Blue Cloud Ventures, bringing its 2025 total to €170 million.
This week’s $270 million dwarfs all of that combined and pushes the valuation from roughly $800 million in December to $1.7 billion now.
Training a cybersecurity model on machines
Exein’s next move is bigger than another funding round: a foundation model for physical AI security, trained on two years of machine telemetry gathered across its device footprint — how machines actually operate, rather than the human-generated text most large language models learn from.
That dataset, if it holds up, would be hard for a rival to copy quickly. Exein plans to layer autonomous agents on top that can identify and respond to attacks without waiting for a person to approve the fix, targeting the new architecture by the end of 2026 and the first foundation models in the first quarter of 2027, an aggressive timeline for a category that barely exists yet outside Exein’s own data.
Headline partner Clarey Zhu, who led the round, points to the team as much as the technology: “As AI moves into robots, vehicles, and critical infrastructure, securing the physical world will become one of the defining cybersecurity challenges of the next decade… Gianni and his team have incredible technical and commercial depth, they put customer trust above all else, and they have always chosen the harder, long-term-oriented path.”
The competition, and where the money goes
Exein isn’t the only one betting physical AI needs its own security layer. TFN has covered HIVE, which raised $15 million to build a shared “brain” for industrial machines, and Embedd, the London startup that raised $2.7 million to cut the software integration work behind robots and drones.
Neither competes directly with Exein, but both point to the same shift: AI moving off screens and into hardware. The closer rivals sit in operational technology security: Claroty and Nozomi Networks watch industrial networks from the outside for anomalies, and Armis does something similar while being acquired by ServiceNow for $7.75 billion, a deal expected to close in the second half of 2026.
Exein’s pitch is that watching the network isn’t enough once a device is autonomous, because by the time an anomaly appears on a dashboard, the machine may have already acted. Whether that holds up against well-funded, network-layer incumbents is the question this round doesn’t answer.
The new capital, plus an expanded revolving credit facility led by J.P. Morgan, with KfW joining as an additional lender, will fund further US and Asia-Pacific expansion, including a planned Bay Area office and a South Korean office expected by 2027. Exein has already opened an APAC headquarters in Taiwan and a legal entity in Japan, and says roughly half its revenue now comes from Asia-Pacific.
Sofina managing director Maxence Tombeur frames the round as a bet on timing: “Gianni had the foresight to build for this transition years ahead of the market, and we are delighted to support him and the team as they scale Exein globally.”
The IoT security market is projected to grow from $35.5 billion in 2024 to $53.3 billion this year and $141.8 billion by 2030. That’s the size of the opportunity Exein is chasing, and also the size of the crowd chasing it alongside them. A model trained on two billion devices is a real edge today.
Whether it stays one depends on how fast Exein can turn machine telemetry into a shipped product before Armis’s new owner, or someone else, builds the same thing.
