VCs Investing In Cybersecurity In 2026

Venture capital money flowed nice and steadily into cybersecurity last year as defence, AI and national resilience took priority. A Sifted report mentioned that much of the attention in European defense tech prioritised mainly drone makers such as Germany’s Helsing and Stark and the UK’s Cambridge Aerospace. Behind that noise, cyber gained ground.

Rocio Pillado, partner at Spanish deeptech VC Adara Ventures, told Sifted, “Cybersecurity doesn’t produce the same flashy hardware or imagery that defence investors often look for — it’s quieter, but that doesn’t make it less strategic.” She added, “Whether we’re talking about satellite systems, autonomous platforms or AI-driven intelligence, their effectiveness depends entirely on how secure, resilient and trusted their digital backbone is.”

Cyber attacks hit airports in Germany, the UK and Belgium in September, pushing resilience higher up the political and investment agenda. Software and data systems now sit inside almost everything from drones to power stations. Joshua Walter, partner at Osney Capital, said infrastructure such as power plants and nuclear stations are now “far more connected than they were a decade ago,” and the opportunity for startups defending them is “significantly” greater.

Where Did The Money Go?

Grace Cassy, founder of CyLon and a former UK diplomat, described cyber as a new theatre of conflict. She said, “So you have air, land, sea, space, [and] cyber now being recognised as a domain in its own right that we need to think about as a place where future contests and conflict is played out.” She also said that as NATO embraces more of a “data-led, software-defined style of fighting, the ability to have confidence in your data and confidence in your communications is only going to increase.”

Investors showed interest in deception tools, AI model robustness and secure infrastructure for critical systems. Pillado highlighted Spanish company CounterCraft, which builds deception and threat intelligence tools for enterprises and governments. Walter pointed to UK startup Sitehop, which develops encryption for government and national security use.

Disinformation also attracted capital. Cassy referred to Refute in London, which applies a “threat intelligence-type approach to understanding what’s real and what isn’t, and helping governments and enterprises, frankly, to ensure that the narratives that are out there about them are real.” Command and control software and security for AI systems running at the edge also featured in new deals.

How Are Top VCs And Governments Responding?

CB Insights said its 2025 Smart Money list reviewed more than 12,000 venture investors over 10 years. The top 25 were 6.5x more likely than the average VC to invest in a future unicorn and recorded 2.2x more exits per investor. Smart Money investors backed 52% of new AI unicorns in 2023, 73% in 2024 and 77% in 2025 year to date. CB Insights said its M&A probability model identifies cybersecurity as the most likely near term exit pool among Smart Money portfolios, naming companies such as Tenex.ai.

Government money also increased. The UK government said cybersecurity forms a core pillar of its Industrial Strategy released in June 2025. It pledged up to $14 million for the CyberASAP programme and $8 million to support SMEs and startups in the cyber sector. In 2024, the UK cyber sector generated $17.8 billion in revenue and employed 67,300 people, showing YoY growth.

2026 has more opportunities in store, and more jobs to create. Who exactly is investing right now?

VCs Investing In Cybersecurity

The following VCs are actively investing in cybersecurity:

DataTribe

The DataTribe Foundry leverages deep experience and expertise to build and launch successful product companies. The team is a mix of Silicon Valley and Intelligence Community founders, investors, and experienced entrepreneurs. We know what it takes to build a company, but more importantly, we understand the world our startup founders are coming from. We put real firepower behind every idea.

DataTribe starts relationships with seed-stage companies by making an investment and accepting them into The Foundry. We continue to support companies through follow-on investments as they mature out of the Foundry into their growth stage.

Todd Graham, Managing Partner at M12, Microsoft’s Venture Fund

Todd is a managing partner at M12, where he leads investments in cybersecurity, developer tools, and cloud infrastructure.

Prior to joining M12, Todd was Vice President at Venrock, where he focused on early-stage enterprise infrastructure and cybersecurity investments.

He is very passionate about the intersection of technology and business. His main areas of interest include digital transformation, human-based threats, disruptive go-to-market, and the consumerization of the enterprise experience.

In his career, Todd has alternated between startups and large infrastructure vendors. Prior to Venrock, he led Corporate Strategy for Cisco’s Security and Collaboration businesses where he developed long-range business strategy while also driving inorganic activities such as the acquisition of Duo Security.

Earlier in his career, he led product for IT Business Management at VMware. Using experience gained at VMware, Todd co-founded Bluenose Analytics to help customer success leaders better manage their customers.

While attending college, he founded a Data Loss Prevention company that was acquired by EMC’s security division, RSA.