Italy’s Exein Raises $270 Million to Build a Foundation Model for Physical AI Security

Rome-based cybersecurity startup Exein has raised $270 million in a funding round that pushes its valuation to $1.7 billion, a jump multiple outlets are reporting makes it the most valuable cybersecurity startup in Europe. The round, led by US investor Headline, will fund Exein’s expansion into what the company calls Physical AI security: protecting robots, drones, self-driving cars, and industrial machines that use AI to sense their surroundings and act in the physical world, rather than just guarding cloud accounts or login credentials.

Protecting Machines Instead of Servers

Founded in 2018 by CEO Gianni Cuozzo, Exein has spent the years since building embedded, runtime security software that runs inside connected devices themselves rather than monitoring them remotely from the cloud. The company says its technology is now deployed across more than 2 billion connected devices spanning industrial automation, automotive, energy, healthcare, semiconductors, aerospace, and robotics, with roughly half its revenue coming from Asia-Pacific. That footprint is what the new funding is meant to extend into a newer category the industry has started calling Physical AI: machines that perceive their surroundings, decide, and act on their own, where a successful attack does not just leak data but can crash a vehicle or injure someone standing near a factory robot.

“AI is moving out of the cloud and into the physical world, and this is the transition Exein was built for,” Cuozzo said in the company’s funding announcement. “We’ve developed deep expertise in how machines operate, invested heavily in the technology needed to protect them and built a global footprint that gives us an understanding of machines at a scale few others can match.”

An Oversubscribed Round Backed by Goldman Sachs and the EIB

The $270 million round (reported as €234 million in the euro figures Exein itself uses) was led by Headline, with new participation from Sofina, Goldman Sachs, the European Investment Bank Group through its ETCI vehicle, KfW Capital, and T.Capital. Existing backers Balderton, Lakestar, HV, Intrepid Growth Partners, 33N Ventures, Supernova Invest, Blue Cloud Ventures, and Geodesic Capital also added money. Tech.eu reports the equity round was significantly oversubscribed, and Exein separately upsized an existing revolving credit facility led by J.P. Morgan, with KfW joining as an additional lender.

The company says its valuation has grown thirtyfold in two years, and that first-half 2026 annual recurring revenue was up 4x year over year. That pace shows in the fundraising history: Exein raised a €15 million Series B in 2024, followed by roughly €170 million across two separate rounds in 2025, before this latest €234 million close. SecurityWeek reports the new round brings Exein’s total funding to over $600 million.

Headline partner Clarey Zhu framed the bet as an early move in a category still being defined. “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,” Zhu said, according to EU-Startups. “Exein’s deep expertise in embedded systems and unique machine data give it a powerful advantage as it scales globally, and that advantage traces back to the team. 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.”

From Kernel-Level Runtime Protection to a Foundation Model

Exein’s flagship product today is Photon, a kernel-level runtime security architecture the company launched earlier this year that is built to block malicious code execution before it runs, instead of detecting and cleaning up after an attack has already succeeded. The company argues that distinction matters more for autonomous machines than for a typical laptop or server: a self-driving car or a factory robot needs a security response fast enough to act before physical harm occurs, not after a breach has been logged and reviewed hours later.

Much of the new funding is earmarked for a follow-on bet: a proprietary foundation model built specifically for Physical AI security, trained not on the human-generated text and code that general-purpose large language models learn from, but on machine telemetry Exein has collected across its device footprint. The company wants that model to power what it calls an agentic security architecture, autonomous agents designed to detect and contain attacks at what Cuozzo calls machine speed, faster than a human analyst or a cloud-based detection pipeline could respond.

“Frontier models are pushing the patch window to zero. Attacks now happen at machine speed, so defense has to as well,” Cuozzo said. “Physical AI is the natural next step for Exein: we’re building machine-time security for machine-time attacks.”

Exein reports it is now seeing roughly 5,000 new, non-repetitive attacks against its protected devices every week, a figure the company says is five times higher than a year ago. Some of the new funding will also go toward opening an office in the San Francisco Bay Area as part of that push, alongside Exein’s existing operations in Germany and Taiwan.

One of Several Bets on Securing AI Outside the Data Center

Exein’s raise lands in a busy year for AI-focused cybersecurity funding, though at a scale well above most of its European peers. EU-Startups, which has tracked Exein’s fundraising since its 2024 Series B, counted roughly €161 million in comparable and adjacent 2026 European security rounds before this one: Belfast-based Cloudsmith’s €61.5 million round to secure AI-driven software supply chains, Paris-based Qevlar AI’s €25.8 million raise for an agentic security operations platform, Barcelona-based NeuralTrust’s €17.2 million round to secure enterprise AI agents, and Escape’s €15.4 million raise for an AI-powered offensive security platform. The closest comparison to Exein’s own focus is smaller still: Finland’s Test of Things raised just €1.2 million to automate cybersecurity testing for IoT products. Exein’s single round is larger than the combined total of every other deal on that list, a gap that says as much about how differently investors are pricing device-level, embedded security as it does about Exein specifically, next to the software- and cloud-focused AI-security startups that have dominated funding headlines so far this year.