Tel Aviv-based CYE, which uses AI and human hackers to test a company's security resilience, raises $120M led by EQT
The soaring number of cyberattacks has propelled a massive expansion of potential solutions as startups and incumbent security providers jostle to address the market opportunity.
Context & Ripple Effects
CYE's $120M round lands inside an Israeli cybersecurity funding wave that has been compounding for years: Israeli cyber firms raised $4B in 2024, double the prior year per YL Ventures, and later rounds like Cyera's $600M raise at a $12B valuation pushed the ceiling far higher. The lead investor here matters too — Swedish firm EQT, which the related coverage shows deploying across enterprise software from IFS to Neogov, is putting institutional private-equity weight behind offensive security testing.
The more immediate comparison is Cymulate, the Tel Aviv-based rival that raised a $70M Series D to stress-test corporate networks in 2022. Both sell the same premise — probe defenses before attackers do — so CYE's war chest sharpens a contest between automated simulation platforms and its hybrid model pairing AI with human hackers.
First-order effects
- CYE gains capital to scale its combined AI-plus-human-hacker testing services, while EQT adds an offensive-security asset to a portfolio the coverage shows spanning enterprise software plays like SUSE, IFS, and Douzone Bizon.
- Security teams evaluating resilience testing now face a better-funded CYE competing directly with Cymulate's network stress-testing platform for the same budgets.
Second-order effects
- Cymulate must answer a rival whose human-red-team layer differentiates it from pure automation, pressuring both vendors' pricing and product roadmaps in breach-and-attack simulation.
- EQT's lead role signals that growth-stage private equity — not just venture funds — sees validated security testing as an investable category, widening the buyer pool for later-stage Israeli cyber rounds.
Third-order effects
- If the funding trajectory holds — from Cynet's $40M Series C through CYE's $120M to Cyera's multibillion-dollar rounds — security validation risks becoming a crowded subsector where mid-sized players consolidate or get absorbed by platform vendors.
- Sustained capital into testing startups points toward enterprises treating continuous adversarial validation as a standing budget line distinct from preventive tooling, reshaping how security spend is allocated across the stack.
The trend: Offensive security testing is becoming an institutionally funded category, with Israel's doubling cyber funding cycle turning adversarial-validation startups into large-scale platform bets.