New Italian unicorn Exein rides the physical AI wave

Europe has a new unicorn: Italian startup Exein has just raised a $270 million funding round led by Headline at a $1.7 billion valuation on the promise of providing a cybersecurity layer for physical AI — an evolution of its initial focus on IoT.

“The concept of Exein is that every device should be able to defend itself, regardless if they are connected to a secure network or not,” CEO Gianni Cuozzo told TechCrunch. The Rome-based company has been doubling down on this approach; its latest product, Photon, is a runtime security solution to prevent attacks at the kernel level of a device.

This approach requires working in close partnership with manufacturers, and Exein says it has been doing so since its inception in 2018. According to Cuozzo, the choice to work directly with OEMs and silicon vendors was driven by the conviction that connected devices were on the rise. 

This created significant tailwinds for Exein, which claims to have secured more than 2 billion connected devices in sectors where cyberattacks could be paralyzing, including aerospace, industrial automation, automotive manufacturing, energy, healthcare, and semiconductors.

The startup expects its growth to be sustained by the rise of physical AI, which uses the same supply chain. Cuozzo noted that his product can cover AI-powered robots, drones, self-driving cars, sensors, smart appliances and other connected devices running models on the edge.

Investors seem to agree: Exein says that its latest round was significantly oversubscribed. Its valuation has increased thirty-fold since its Series B some two years ago, and more than doubled since it secured equity and debt in December 2025 following its Series C earlier last year.

Besides valuations, AI has also boosted attackers’ capabilities. According to Cuozzo, this is being facilitated by open-source models that can run without guardrails, and make it much easier and cheaper to target physical devices in novel ways.

Exein has already seen an increase in what Cuozzo calls “machine-speed attacks,” and intends to respond with a foundational model for Physical AI security. The company is currently training the model on machine data and telemetrics, and plans to have it ready in the first quarter of 2027.

In the meantime, Exein intends to use the fresh funding for M&As to complete its portfolio of products, and hire staff to accelerate its expansion in the U.S. and in the Asia Pacific, which currently drives half of its revenue. 

Cuozzo said being spread across three continents has been Exein’s main challenge so far. The breadth of its presence took some adjusting to, but it has borne fruit, he said, noting that the company is “growing 400% year on year.” 

While such growth numbers are often hard to maintain, Exein could get a hand from the European Union’s Cyber Resilience Act, whose reporting obligations kicked off last week. The Act will come into full force in December 2027, and requires manufacturers to “make sure all digital products are safe from cyber threats.”

Pictured from left to right: Gerardo Gagliardo, CFO & co-founder; Gianni Cuozzo, CEO & founder; Giovanni Alberto Falcione, CTO & co-founder.