Italian cyber security start-up Exein has raised $270mn, as industry races to protect billions of internet-connected devices from AI-powered hackers. Founder and CEO Gianni Cuozzo said AI tools have supercharged hackers' ability to compromise connected machines, requiring a new approach to device security. "Right now I think the hackers have the edge," he told the FT. Exein uses embedded AI technology to offer machine-based protection against machine-based attacks.

The round, led by San Francisco-based venture capital firm Headline, values Exein at $1.7bn — more than double its $770mn valuation nine months ago. Clarey Zhu, partner at Headline, said securing the physical world will become a defining cyber security challenge of the next decade. The investment makes Exein Europe's second most valuable private cyber security company after Lithuania's $3bn Nord Security.

Exein protects devices during manufacturing by inserting security into firmware. Its technology is already in over two billion devices worldwide. The company is developing its own foundation model for physical AI security, launching next year. Cuozzo noted hackers increasingly use open Chinese AI models for offensive capabilities. The funding will help Exein compete for scarce cyber security talent against major AI labs.