Cleo Capital, an early-stage venture fund that counts AI company Groq, fintech company Ellevest, and fashion brand Hill House among its investments, has announced the launch of a new cybersecurity accelerator.
The program seeks pre-seed and seed companies from around the world. The accelerator is a remote 12-week program with a standard investment of $250,000 for 7% equity. The venture fund said up to 10 companies will be selected for the program.
Sarah Kunst, founder and managing partner of Creo Capital, is concerned about the amount of fraud she sees in the cryptocurrencies and fintechs she invests in, as well as dating apps like Bumble, where Kunst is an advisor. He said he was inspired to start the accelerator after seeing what was happening. .
“I know it's out of control,” Kunst told TechCrunch after hearing stories of cyber threats and scams hitting the small American town where her father and grandmother, who is in her 90s, live. .
Cybersecurity threats are becoming increasingly expensive, especially as AI becomes more sophisticated. In 2023, the FBI found that Americans lost more than $12.5 billion to cybercrime, including romance scammers and bogus legal fees. That's more than double the total increase of $11 billion stolen from Americans in 2020 and 2021, according to the agency's latest data.
But even when there are cybersecurity issues, there is plenty of room for innovation. In recent years, venture capital has flooded into the cybersecurity sector due to rebound demand from the 2023 downturn. As TechCrunch previously reported, several established cybersecurity companies were founded this year and reached “unicorn” status, including Chainguard, Huntress, and Bugcrowd.
“Cybersecurity investors have told me that this is an area where only corporate startups can grow, but I reject that idea,” Kunst said. “With 90% of Americans facing cybersecurity issues, many of which occur in their consumer lives and on consumer devices, this is a momentous opportunity that we cannot afford to miss. ”
Currently, Kunst is looking for companies in the consumer, defense sector, and development tools and infrastructure. For Kunst, the pressing issue is that it's too easy for scammers to target victims. “On social media and dating apps, you can pretend to be anyone,” she says.
That's why she wants to address the “catastrophic burden” of the internet becoming “unusable” in the face of online cybersecurity threats. Kunst said he believes there will be an increase in online authentication to prove identity, tools that alert users to potential fraud, apps that help protect against government-backed cyberattacks, or startups to ensure their products are secure. We talk about the proliferation of tools that can be used to In the meantime, companies must always consider the impact of the products they are developing on user privacy.
The deadline to apply for the accelerator is January 20th, and the start date is February 24th.
“This is the small beginning of a huge industry,” she says. “We need and deserve an internet with some level of trust and security. Cleo is funding that change.”