Ballistic Ventures Targets $490 Million for New Cybersecurity Investment Vehicles
San Francisco-based venture capital firm Ballistic Ventures has filed to raise $490 million across two new funds, as reported by TechCrunch. The firm, led by industry veterans including Ted Schlein, is positioning itself to capitalize on the surge of AI-driven cybersecurity threats and the accompanying growth in startup opportunities within the sector.
Context from Industry Pulse
The fundraising push by Ballistic Ventures aligns with a significant escalation in cybersecurity deal flow. As reported by TechCrunch using JPMorgan Chase and PitchBook data, U.S. cybersecurity startups reached an investment peak of $11.5 billion in 2025, the highest level since 2022. This momentum is heavily driven by artificial intelligence, with 72% of sector deals involving AI-enabled companies by mid-year. While Microsoft warns that hackers are utilizing AI to scale phishing and malware operations, the venture community is doubling down on startups that provide defensive shields. Ballistic’s strategy reflects this market shift, moving from its $300 million debut fund to larger, specialized vehicles to maintain pace with these technical advancements.
"The technology is allowing attackers to operate faster and at greater scale, even as many of their underlying techniques remain unchanged."
According to TechCrunch, regulatory filings with the U.S. Securities and Exchange Commission show that Ballistic Ventures is seeking $360 million for its third flagship fund. This amount matches the capital raised for its second fund in 2024. Additionally, the firm is pursuing $130 million for a separate vehicle designated as Ballistic Ventures Fund B. At the time of the filing, neither fund had recorded any sales, and the firm declined to provide comments on the specific fundraising efforts.
The investment strategy for the new capital focuses on a rapidly evolving threat landscape. TechCrunch reports that the rise of artificial intelligence has increased concerns regarding sophisticated cyberattacks, while simultaneously creating a market for AI-agent security solutions. Microsoft recently highlighted this shift, noting that attackers are leveraging AI to accelerate phishing, social engineering, and malware development, even as traditional techniques remain in use.
Ballistic Ventures was established in late 2021 by a team with deep industry roots. Co-founder Ted Schlein previously spent over two decades at Kleiner Perkins. Other founding members include Barmak Meftah, the former president of AT&T Cybersecurity, and Roger Thornton, who helped start AlienVault and Fortify Software. TechCrunch notes that the firm’s connection to Kleiner Perkins serves as a differentiator, even though its general investment approach mirrors competitors like Ten Eleven Ventures and Forgepoint Capital.
The firm has already seen several successful exits from its portfolio. These include Talon Cyber Security, which was purchased by Palo Alto Networks, and Pangea, acquired by CrowdStrike. Other current holdings include startups such as Nudge Security, Oligo Security, and GetReal. This activity occurs during a broader rebound in the sector, as U.S. cybersecurity startups reportedly raised over eleven billion dollars in 2025.
Data cited by TechCrunch indicates a significant shift toward AI-centric investments. Through May of this year, companies utilizing artificial intelligence represented approximately 72 percent of venture deals in the cybersecurity space. This is a substantial increase from 2019, when such companies accounted for only 36 percent of deals, highlighting the industry’s current priority on automated defense and threat detection.
The Industry Pulse Bottom Line
Ballistic Ventures is leveraging its founders' deep industry pedigree to capture a significant share of the AI-driven security boom, signaling that institutional appetite for sophisticated, automation-focused defense remains high despite broader economic fluctuations.