August 1, 2023 – Irvine, CA – Steg.AI, the enterprise security platform for digital assets, has raised $5M in early stage financing led by cyber and advanced technologies investor, Paladin Capital Group, with participation from Washington Square Angels, the NYU Innovation Venture Fund, and angel investors, Alexander Lavin, Eli Adler, Brian Early and Chen-Ping Yu.
Steg.AI’s information security software enables businesses to protect their digital intellectual property (IP) from costly leaks and misuse. Steg.AI’s forensic watermarks imbue provenance into digital assets, as though every image is embedded with an invisible QR code. Steg.AI helps to counter the decay in trust created by the rise of deep fakes, misinformation, and data theft by protecting and authenticating digital assets.
Its core innovation is state-of-the-art photographic steganography and forensic watermarking technology developed by the co-founders, CEO Dr. Eric Wengrowski and Chief Scientist Prof. Kristin Dana. Steganography is the science of secretly storing information within a non-confidential channel.
Dr. Eric Wengrowski explained: “Steg.AI is responding to the need of companies to control the security of their digital assets. When an organization’s product roadmap or trade secrets are leaked, it must identify who is responsible for the security breach. With Steg.AI, an invisible and forensic watermark is encoded when digital assets are created and shared, protecting their provenance throughout their lifecycle – even once an asset has been manipulated.”
Steg.AI operates on a B2B SaaS model, where customers subscribe to annual API access and pay based on usage volume. The company has secured its first major enterprise customer, a global electronics brand, and has been recognized by a peer-reviewed publication in the top computer vision journal, CVPR.
The startup is focusing first on leak solutions having identified an opportunity in the Data Loss Prevention (DLP) market, which is expected to grow from $2.2B today to $6.2B by 2028, according to Mordor Intelligence. Steg.AI is disrupting DLP as its application integrates more flexibly with customers’ current software workflow than competing solutions.
Christopher Steed, Chief Investment Officer, Paladin Capital Group, who joins Steg.AI’s board, said: “With 4.7B photos and 720,000 hours of video uploaded every day, the need to defend against digital fakery and piracy is huge and evolving. Consumer companies risk losing millions of dollars if their product IP is leaked to the competition.
“Steg.AI offers a simple-to-use, cost-effective solution that can be scaled easily across an enterprise. We’re excited to back a company with such potential at an early stage, and look forward to helping Eric, Kristin and team build their commercial offering.”
Steg.AI’s team includes three Machine Learning PhDs, a Fortune 500 executive, and a Disney Imagineer turned serial entrepreneur. The company has been funded through $1.2mm in non-dilutive National Science Foundation (NSF) Small Business Innovation Research (SBIR) awards, angel investment, and a $5mm seed investment led by Paladin Capital.
The company has been recognized with a peer-reviewed publication in the top computer vision journal (CVPR, impact factor: 47.8), the 2019 LDV Summit Entrepreneurial Computer Vision Competition winner, and SBIR Phase I and II awards from the US NSF. Steg.AI also is a contributing member to the Coalition for Content Provenance and Authenticity (C2PA), the Digital Media Licensing Association (DMLA), also a member of competitive startup accelerators including NYU Endless Frontier Labs, NYU NextRound, UCI Cove, Deep10, and the Nvidia Inception Program.
About Paladin Capital Group
Paladin Capital Group was founded in 2001 and has offices in Washington DC, New York, London, Luxembourg, and Silicon Valley. As a multi-stage investor, Paladin’s core strength is identifying, supporting and investing in innovative companies that develop promising, early-stage technologies to address the critical cyber and advanced technological needs of both commercial and government customers.
Combining proven investment experience with deep expertise in global security, cyber technology and cutting-edge research, Paladin has invested in more than 60 companies since 2008 and has been a trusted partner to investors, entrepreneurs and governments for over two decades.