Ballistic Ventures Seeks $490 Million as AI Reshapes Cybersecurity Investment

Table of Contents

• You might want to know
• Ballistic Ventures’ fundraising and the AI cybersecurity market
• Key Insights Table
• Afterwards...

You might want to know

• Why is Ballistic Ventures seeking $490 million in new capital?
• How is artificial intelligence changing the cybersecurity market for investors and startups?

Ballistic Ventures’ fundraising and the AI cybersecurity market

Ballistic Ventures, a venture capital firm focused on cybersecurity, is seeking to raise $490 million across two new funds, according to regulatory filings. The San Francisco-based firm was co-founded by Ted Schlein, a former partner at Kleiner Perkins. The planned fundraising comes as artificial intelligence is increasingly influencing both the threats cybersecurity companies must address and the opportunities available to startups developing security products.

In filings with the U.S. Securities and Exchange Commission, Ballistic disclosed plans to raise $360 million for its third flagship fund. That target matches the size of its previous flagship fund, which was raised in 2024. The firm is also seeking $130 million for a separate investment vehicle called Ballistic Ventures Fund B. Neither fund had recorded any sales at the time of filing. The filings therefore describe fundraising targets, not completed raises or money already committed by investors.

The timing reflects a market in which AI is affecting cybersecurity in two directions. On one hand, companies and security professionals are concerned that attackers can use AI to develop more sophisticated or convincing campaigns. On the other, the growth of AI agents and AI-enabled products is creating new security needs—and potential customers—for companies building cybersecurity tools. That combination has attracted attention from investors who specialize in the sector.

Ballistic Ventures was founded in late 2021. Its founding team includes Schlein, Barmak Meftah, the former president of AT&T Cybersecurity, and Roger Thornton, a co-founder of Fortify Software and AlienVault. The founders bring experience from venture capital and cybersecurity businesses, giving the firm a team focused on investing in security companies and supporting their development.

The firm’s portfolio includes businesses that have been acquired as well as startups still building their products and customer bases. Talon Cyber Security was acquired by Palo Alto Networks, while Pangea was bought by CrowdStrike. Other startups backed by Ballistic include Armadin, GetReal, Nudge Security and Oligo Security. These examples illustrate the range of companies in its portfolio, although they do not by themselves indicate the performance of either of the proposed new funds.

Ballistic’s connection to Kleiner Perkins is one element that distinguishes it from other cybersecurity investors, according to a cybersecurity investor at another venture firm who spoke to TechCrunch. Schlein spent more than two decades at Kleiner Perkins. The source also said Ballistic’s investment approach is broadly similar to those of other firms focused on cybersecurity, including Forgepoint Capital and Ten Eleven Ventures. In other words, the firm has a distinctive history and network, while operating in an investment category with established competitors.

The fundraising plans follow Ballistic’s earlier fund activity. In 2022, the firm announced its $300 million debut fund. Two years later, it raised another $360 million for its second flagship fund. PitchBook data also indicates that Ballistic raised about $130 million for a separate vehicle called Ballistic Ventures Fund A. Fund B is seeking a similar amount, according to the reported filing. These earlier vehicles provide context for the new targets, but each filing represents a separate fundraising effort.

Broader investment data points to growing activity in cybersecurity. A recent report by JPMorgan Chase, citing PitchBook data, said U.S. cybersecurity startups raised $11.5 billion in 2025, the highest total since 2022. The same report said AI-enabled companies accounted for about 72% of U.S. cybersecurity venture deals through May this year, compared with 36% in 2019. These figures suggest that AI-related businesses have become a larger part of cybersecurity venture activity. They do not establish that every AI-focused company will succeed, but they show how investor attention has shifted.

The expansion of AI use also raises concerns about how cyberattacks may evolve. In its annual Digital Defense Report, released last month, Microsoft warned that hackers are increasingly using AI for activities ranging from phishing and social engineering to malware development. According to the report, the technology can help attackers operate faster and at greater scale. At the same time, many underlying techniques remain unchanged. This distinction matters: AI may increase the speed, reach or sophistication of familiar methods without necessarily replacing the basic approaches attackers already use.

For cybersecurity companies, this environment can create demand for products that help organizations identify threats, protect users, secure software and respond to incidents. AI agents can also introduce new systems and workflows that require protection. Investors may see these changing requirements as a source of opportunities for startups, while also weighing the difficulty of building trusted products in a competitive and fast-moving field. The reported rise in AI-enabled venture deals offers a measure of market activity, not a guarantee of future business outcomes.

Ballistic Ventures declined to comment on its fundraising plans. As a result, details beyond the disclosed targets—including the timing of any closings, investor commitments and the eventual deployment of capital—were not provided in the reported account. The distinction between a target and a completed fundraise is important when interpreting the filings: the firm is seeking the stated amounts, but the filings do not confirm that it has raised them.

Overall, Ballistic’s proposed $490 million fundraising effort combines a $360 million flagship fund with a $130 million separate vehicle. It follows the firm’s previous fundraising and comes amid increased investor activity in cybersecurity, particularly among AI-enabled companies. At the same time, warnings about AI-assisted phishing, social engineering and malware development underscore why organizations may need new or stronger defenses. The market is therefore shaped by both a growing need for security and uncertainty about how quickly threats, products and investment priorities will change.

Key Insights Table

Afterwards...

Ballistic Ventures’ filings capture an investment strategy taking shape during a period of change for cybersecurity. The firm is seeking capital for both a new flagship fund and a separate vehicle, while market data shows a larger role for AI-enabled companies in cybersecurity venture deals. Whether these trends translate into durable businesses will depend on companies’ ability to address real security needs, build reliable products and adapt as attacker techniques evolve.

For now, the figures describe targets and market activity rather than confirmed future results. Fundraising progress, portfolio development and the practical effects of AI adoption will help clarify how the next phase of cybersecurity investment unfolds. The central question is not only how AI changes attacks, but also whether security companies can help organizations respond effectively as both the technology and its risks continue to develop.