Startup Wants to Protect AI Data

 

"A data- and cybersecurity startup has raised $60 million in a growth round, part of a wave of funding for companies that protect the information that gets fed into generative AI systems.

New York-based BigID said the round, led by Riverwood Capital with participation by Silver Lake Waterman and Advent International, values the company at over $1 billion. BigID generates nearly $100 million in yearly revenue, the company said.

Captivated by the promise of generative AI, companies are beginning to use it to leverage their massive data repositories to increase productivity and unlock new business lines. But that data is at higher risk of being hacked and manipulated -- an encroachment known as data poisoning -- investors and entrepreneurs say.

Worldwide, venture funding for startups offering cybersecurity for artificial intelligence applications, including large language models, jumped 81% last year to $224 million, according to analytics firm PitchBook Data. Behind the surge is a broad belief that security must move in lockstep with AI advancements.

In a report published last year, venture firm Menlo Ventures surveyed more than 450 enterprise executives in the U.S. and Europe and found that half of respondents cited data-privacy concerns as a primary barrier for generative AI adoption, the second most common worry in the poll after unproven return on investment.

Since its founding in 2016, BigID has offered general cybersecurity services such as compliance, privacy and governance. But as companies have engaged more with AI, BigID has expanded its offerings to help companies protect the data they intend to use with AI tools such as OpenAI's ChatGPT, said BigID Chief Executive and co-founder Dimitri Sirota.

"It puts us in a unique place to help organizations deal with some of the cleaning and compliance and curation problems for preparing their data for AI," Sirota said. "So we want to double down."

This is the first quarter for which BigID will see revenue attributable to the work it does securing AI data, he said. The firm, he added, has some deals with Fortune 100 companies, deals driven almost entirely by the need to protect their AI data troves. BigID will use the capital to accelerate product development and scale go-to-market capabilities globally.

Francisco Alvarez-Demalde, co-founder and managing partner of Riverwood Capital, said the threats facing corporate data are evolving quickly. Riverwood, which has invested in data-security companies for roughly 10 years, is backing BigID partly because it is nimble enough to adapt to future threats, he added." [1]

1. Startup Wants to Protect AI Data. Vartabedian, Marc.  Wall Street Journal, Eastern edition; New York, N.Y.. 19 Mar 2024: B.4.