Consumer-facing security tools often focus on one type of modality, such as password protection, VPN, or identity management. This forces people to use multiple tools to keep their data private. Cloaked, a company that offers a bundle of security and privacy solutions, announced on Thursday that it has secured $375 million in Series B funding and growth financing to expand its consumer offering and move into the enterprise market.
The company was founded in 2020 by brothers Arjun and Abhijay Bhatnagar, and initially offered users the ability to create multiple identities with data such as email, phone number, and password to log into various services without providing their real data. Over the years, Cloaked introduced other services such as data removal, identity theft insurance, VPN, and dark web monitoring. Last year, it introduced AI-powered call screening.
Now, Cloaked sees an opportunity to protect consumers in a world where hackers or scammers can use AI to obtain data or money in new ways.
“We have seen AI become better than humans at compromising individuals. And we see this as a problem of personal security, family security and financial fraud. We also see [AI proliferating] Scams center around spam and phishing. And now it comes to this era of surveillance, how do you find a solution that fits between these different aspects, and we are winning in this category from the consumer side,” said Arjun Bhatnagar, CEO of the company.
The startup intends to expand its AI-powered screening protection to text messages, emails, and browsing this year. It is also testing an AI agent that can take actions on your behalf, such as changing the password for a service whose data has been compromised. Bhatnagar said the plan is to use AI in a secure manner and not send sensitive information to the cloud.
The company told TechCrunch that it saw 10x growth last year and now has more than 350,000 paying customers. It also protected 10 million identities and helped users clean up more than 1 billion records from data broker sites. Bhatnagar said that since the launch of its call screening feature last year, the app has processed more than 50 million scam or spam phone calls.
Cloaked is also now entering the enterprise, providing employees with some of the same protection as its consumer products, including identity and password management. This product alerts employees about potential scams. Also, the company CISO can view the risk level of individuals and examine the aggregated data of scams that have been cleaned up or closed. And they can see potential scams or data there that could affect the company’s business.
The startup has around 70 employees and aims to expand the team across different areas such as product, engineering, enterprise sales, and international expansion.
Cloaked competes with 1Password, Gordio, Firefox, Proton, and Mozilla. The company also has some overlapping products with one of its investors, DuckDuckGo, which offers VPNs and identity theft protection.
The latest round was led by General Catalyst and Liberty City Ventures, with participation from Lux Capital, Human Capital, Marquee Ventures, Fifth Growth Fund, NFL Players Association, LG Technology Ventures, Assurant Ventures, and DuckDuckGo. General Catalyst also provided growth financing through its Customer Value Fund, which lends money to startups without diluting equity to boost customer acquisition. The startup did not disclose the valuation or split between equity and growth funding.
Previously, Cloaked had raised over $29 million in funding from investors including Lux Capital, Human Capital, and General Catalyst.
Mark Crane, partner at General Catalyst, said the venture has invested in startups in every round but was the first to lead a round. He said Cloaked’s bouquet of security and privacy offerings is suitable for a wide range of consumers.
Crane believes that Cloaked has the right product to protect people and enterprises in the new AI-led Internet and can become a good “housekeeping seal of approval” for users in a world where there are many AI agents.
“In terms of the product, they’ve created a lot of surface area for the consumer and what they want to use for privacy,” he told TechCrunch on a call. “Some people want to use everything out of the box, and some people want to use smaller pieces. And the beauty of Cloaked is that any consumer, whatever they care about, they can reach out to, and they can get the solution they want and need.”
