Agentic AI
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Application Security
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Artificial Intelligence & Machine Learning
Venture Capitalist Nick Davidov Points to Market Demand, Vulnerability Trends
Anthropic’s new artificial intelligence-powered code security tool may have triggered a market selloff this week, but venture capitalists aren’t rewriting their investment plans for cybersecurity vendors, said Nick Davidov, co-founder and managing partner at DVC, a San Francisco-based venture capital firm backing early-stage AI startups.
See Also: How Unstructured Data Chaos Undermines AI Success
Despite the volatile week for cybersecurity stocks after the release of Claude Code Security, which uses AI agents to scan for software vulnerabilities, Davidov says the long view still favors AI-native security innovation (see: Anthropic’s AI Bug Hunter Jolts Cyber Stocks).
“We do not work based on news, but with trends,” he said. “Every technology inevitably is going to become a commodity.”
Davidov says his firm invests in multi-year technology shifts such as the steady commoditization of large language models and the rising volume of AI-generated code that will expand the attack surface for threat actors. He foresees increasingly cheap and capable models in the cybersecurity space and a world of automated bots attacking and defending digital infrastructure on a massive scale.
In this video interview with Information Security Media Group, he also discussed:
- Why AI-generated code will increase security demand rather than reduce it;
- How prompt injection and agent manipulation create new enterprise risks;
- Why market sell-offs are amplified by algorithmic trading, not fundamentals.
Davidov’s company DVC has invested in more than 140 early-stage AI startups since 2015, including Perplexity AI, Etched and Mira Murati’s Thinking Machines Lab. Prior to DVC, he co-founded Cherry Labs, an AI and computer-vision startup, and held growth and leadership roles at MSQRD, a mobile video filters platform later acquired by Meta. He is also co-founder of early-stage investment firms Gagarin Capital and iTech Capital.

