Reco Raises $25M to Revolutionize SaaS Security with AI-Driven Solutions

Cloud security startup Reco raises $25M in funding - SiliconANGLE

Recolabs Inc., a startup that helps companies secure their software-as-a-service applications, has closed a $25 million funding round to enhance its technology. The investment was announced today. It included the participation of Insight Partners, Zeev Ventures, boldstart ventures, Angular Ventures and Redseed. Rico claims the cash infusion follows a year in which its annual recurring revenue grew fivefold. Before a company can check that its employees' SaaS applications are secure, it has to find those applications. That's not always straightforward because workers often subscribe to cloud services without the information technology team's knowledge. Reco provides a platform that can automatically map out employees' SaaS applications to save time for IT teams. After identifying the cloud services that are used in an organization, Reco scans them for cybersecurity issues. It uses a collection of artificial intelligence agents to carry out the task. According to Reco, its AI can spot if some of the employee accounts in a SaaS application has access to more business data than strictly necessary. The platform also identifies login credentials that aren't actively used. In the event of a breach, hackers can exploit unused and misconfigured accounts to steal data that otherwise wouldn't be accessible. User accounts aren't the only source of risk in SaaS environments. A growing number of SaaS applications include generative AI features such as customer support chatbots. In the event of a configuration issue, an embedded AI tool might make sensitive data entered by one user accessible to other customers. Reco says that its platform can detect such AI data leaks, as well as integrations through which a SaaS application might leak information to other cloud workloads. In addition to detecting cybersecurity issues, the software spots attempts by hackers to exploit those issues. It can identify unusual data access patterns that suggest an employee account may have been compromised. Reco provides a natural language description of potential breaches, as well as a timeline of the cybersecurity events associated with each incident. The company's platform doubles as a compliance tool. Companies can use it to check whether their SaaS environments adhere to regulations such as the GDPR privacy regulation. To ease the task, Reco provides several hundred prepackaged detection controls, automated workflows that spot issues as misconfigured security settings. "The adoption of AI apps and agents has made SaaS security more complex and dynamic than ever," said Reco co-founder and Chief Executive Officer Ofer Klein. "Combine this with the proliferation of SaaS apps including shadow apps, and we're seeing a growing gap between the reality of the ecosystem and what legacy SSPM tools can provide."

Reco Secures $25M to Close the 'SaaS Security Gap' With AI-Native Dynamic SaaS Security

Investment fuels development of Reco's AI-native dynamic SaaS security solution, and scaling go-to-market amid surging market demand MIAMI, FL, April 22, 2025 (Newswire.com) - Reco, a leader in Dynamic SaaS Security, today announced $25 million in additional funding from Insight Partners, Zeev Ventures, boldstart ventures, Angular Ventures, and funding from new investor Redseed following 5x growth in 2024. This latest round brings Reco's total funding to $55 million. The company intends to leverage the new funding towards scaling its AI-native SaaS security platform, while accelerating channel partnerships and capitalizing on its ongoing market momentum. The SaaS security landscape has undergone a major shift, with organizations realizing that legacy security solutions can no longer keep pace with modern business needs. Enterprises now run an average of 1,061 SaaS applications - a 26% increase over the past two years. At the same time, 80% of employees admit to using unauthorized SaaS and AI apps, commonly known as 'shadow tools,' which contribute to 35% of data breaches. The financial toll is often substantial, with the average cost of a data breach reaching a staggering $4.88 million in 2024,according to IBM. The investment comes amid Reco's rapid growth, with the company achieving a fivefold increase in ARR over the past year and a threefold rise in customer numbers. Reco has experienced huge market adoption and has a NPS of 82 across all of their customers. As the company continues to scale, Reco is expanding its capabilities - adding new integrations weekly and earning the trust of leading enterprises in various industries including high-regulated financial services, insurance, healthcare, pharma, and tech. With its workforce doubling across multiple regions, Reco recently appointed Bob Horn as its new CRO. Bringing over two decades of sales leadership experience in cybersecurity startups, Horn will lead the company's global sales strategy as it accelerates its trajectory of hypergrowth. "The adoption of AI apps and agents has made SaaS security more complex and dynamic than ever. Combine this with the proliferation of SaaS apps including shadow apps, and we're seeing a growing gap between the reality of the ecosystem and what legacy SSPM tools can provide. Businesses need security solutions to be proactive vs. just reactive - simplifying security without slowing down the business," said Ofer Klein, co-founder and CEO of Reco. "The strong interest in this oversubscribed round reflects the confidence of our customers, strategic partners, and new investors who share our vision. We are enabling enterprises to contain SaaS sprawl, and this demand-driven growth is proof of how Dynamic SaaS Security is the future." Reco addresses these critical challenges with a comprehensive application discovery engine capable of identifying and classifying over 50,000 applications, providing visibility into an organization's SaaS ecosystem. Its proprietary SaaS App Factory™ currently secures over 175 applications and integrates new apps within 3-5 days - far faster than the months-long timelines of legacy providers. Operating at 10x the speed of competitors with 80% less implementation and maintenance effort, Reco delivers continuous security and compliance, even as new apps and AI agents are introduced or updated - offering businesses the protection they need at the pace they require. "We've witnessed firsthand how Reco transforms SaaS security from a constant struggle to a strategic advantage," said Mihau Faur, CIO, UiPath. "Their technology reduces our team's workload significantly while providing substantially better visibility and protection across our rapidly evolving SaaS environment." With this funding round, Reco will continue expanding the AI-driven SaaS App Factory™ on top of over 175 apps supported today to maintain industry-leading integration speeds while also introducing Reco AI Agents for alerts and identities - becoming the industry's first to offer agents designed to help security teams streamline operations and deliver actionable insights from SaaS. Leveraging secure AI-driven analytics, automation, and contextual intelligence, the agents prioritize alerts, identify threats, and reduce workloads - all while maintaining strict data privacy. "Reco has identified a critical security gap that legacy vendors typically cannot address," said Praveen Akkiraju, Managing Director, Insight Partners. "Reco is transforming SaaS security - delivering seamless execution that scales with enterprise needs and is fueled by deep customer trust. Their innovative approach to Dynamic SaaS Security and exceptional team position them to lead this rapidly expanding market. We're excited to partner with the Reco team as they accelerate their growth and go big on the market." Reco will be exhibiting at the RSAC Conference 2025 at booth #1361. About Reco Reco is a leader in Dynamic SaaS Security, eliminating the SaaS Security Gap caused by SaaS Sprawl - the proliferation of apps, AI, identities, data, and configuration challenges. Reco continuously discovers all SaaS apps, AI agents, and shadow AI tools, and their associated identities, securing configurations, minimizing access risks, and detecting hidden threats. Using advanced analytics on user behavior and interactions, Reco identifies misconfigurations, over-permission users, and compromised accounts. Reco secures over 175 SaaS apps, and adds new app support in days, not quarters. Learn more and book a demo at www.reco.ai.