Why Upwind Is Eyeing $250M of Funding at a $1.5B Valuation

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January 21, 2026    

The cybersecurity unicorn drought has turned into a downpour.

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Between July 2022 and March 2024, no early-stage security vendors achieved a valuation of more than $1 billion – or unicorn status – as investors began penalizing startups for running massive losses on small amounts of revenue. The freeze began to thaw in April 2024, when Cyera got a $1.4 billion valuation alongside a $300 million funding round, making it the first new cyber unicorn since Vanta in June 2022 (see: Cyera Gets $300M at $1.4B Valuation to Fuel Safe AI Adoption).

Nearly two years later, it’s a very different story. This month alone, New York-based hyper automation startup Torq joined the unicorn club with a $1.2 billion valuation in conjunction with its $140 million Series D funding round, and Ghent, Belgium-based software security startup Aikido Security became a unicorn with a $1 billion valuation in conjunction with its $60 million Series B funding round.

The unicorn mint could hit the trifecta in January, with San Francisco-based cloud security firm Upwind in talks with Bessemer Venture Partners and Picture Capital to raise more than $250 million at a valuation of $1.2 billion to $1.5 billion, Calcalist reported Wednesday. Upwind in December 2024 closed a $100 million Series A funding round and tripled its valuation over the prior 15 months to $900 million (see: Upwind Raises $100M to Thwart Cloud Security Vulnerabilities).

Cloud Security Funding Seeks to Rebound After Bleak 2025

Upwind didn’t respond to Information Security Media Group requests for comment. The company, founded in 2022, employs 337 people and has brought in $180 million in outside funding, including a $50 million cash infusion in September 2023. Upwind is led by co-founder Amiram Shachar, who previously sold cloud infrastructure optimization firm Spot.io to NetApp for $450 million in July 2020.

If Upwind’s funding round materializes, it would represent a reversal of fortunes for the cloud security space following a dismal 2025. Just 15 cloud security vendors received funding last year, which is 11th out of the 12 security sectors tracked by Momentum Cyber, with only endpoint security faring worse at 11 deals. Artificial intelligence security was the hottest sector in 2025 for financing, with 144 deals notched.

It was a different story in 2024, when the cloud security sector got $1.58 billion in venture funding – driven by Wiz’s $1 billion funding round in May – placing the market behind only AI security and data security, Momentum Cyber found. A Wiz report found 85% of organizations plan to increase their cloud security spending in 2026, ahead of every other cyber category including data, which came in at 77%.

While cloud security financing activity was meager in 2025, it was a different story on the M&A front, with Google agreeing to spend $32 billion on Wiz in the biggest cybersecurity acquisition of all-time. Whether the price is a sign of the increasingly criticality of cloud defense or speaks to the lackluster state of pure-play cloud security startups aside from Wiz remains an open question.

What Sets Upwind Security Apart From the Competition

Upwind is trying to change that by moving away from traditional approaches focused on static data and configurations and instead embrace real-time runtime insights to deliver precise, actionable security recommendations, Shachar told ISMG in December 2024. The company plans to take on long-term cloud security challenges such as API protection, misconfiguration management and vulnerability detection.

Shachar said Upwind is using AI both to enhance operational efficiencies as well as to secure the training and deployment of AI models, addressing vulnerabilities unique to AI-driven processes. Upwind uses AI to reduce the time to detect, resolve and prioritize vulnerabilities as well as to fix issues related to training and operating AI systems such as data poisoning and model manipulation, Shachar said.

“You need to secure that process,” Shachar told ISMG in December 2024. “You need to make sure that someone’s not sending the wrong data, someone is not poisoning your model. AI has a lot of open-source dependencies, so you want to make sure that someone is sitting between you and your model and is actually telling the right AI to do something.”

Upwind primarily competes against Palo Alto Networks, CrowdStrike and Wiz, and Shachar said his firm excels because its technology isn’t tied to legacy endpoint or network tools, or fragmented by M&A. And unlike older cloud security technologies that focus on visibility and inventory, Shachar said Upwind emphasizes runtime context and API integration to properly address more advanced customer needs.

“We’re not based on legacy technology or stacks of acquisitions,” Shachar told ISMG in December 2024. “So, we have a really good chance to provide a much better product experience.”

Catching behemoths like Palo Alto Networks, CrowdStrike and Wiz will require considerable dry powder since they control nearly half of the $700 million CNAPP market, Dell’Oro Group found in early 2025, with Palo Alto Networks, CrowdStrike and Wiz coming in at 17%, 14% and 11% share, respectively. Wiz and CrowdStrike are growing much faster, with the duo recording CNAPP growth rates of 94% and 78%, respectively, while Palo grew by just 15% (see: Cloud Security Choices: Pure-Play vs. Integrated Platforms).

Despite reportedly crossing the unicorn threshold, Upwind has a long way to go before it could become a public company. Conventional wisdom dictates public cyber vendors should have at least a $5 billion valuation and $500 million in annual sales, but a review of 2025 cyber stock performance found that all companies worth between $1.1 billion and $14.9 billion saw their stock price decline last year.

The crystal ball is murky as to whether Upwind will eventually become the first publicly traded pure-play cloud security vendor or part of a broader cyber or tech platform, but reportedly achieving unicorn status just 41 months after incorporation is a remarkable accomplishent. Upwind’s next act should reveal whether the company is a series of well-designed features or a true platform.