Red Cell Partners, a Washington, D.C.-based incubator focused on national-security startups, has lifted the veil off Hunted Labs, which uses AI to identify malicious threats in software supply chains, and announced $3 million in pre-seed funding for the McLean, Va., startup.
Hunted Labs says its technology creates a “clear line of sight” to the developers and controllers of open-source software organizations use, helping secure critical software supply chains. The company was co-founded in late 2023 by former Booz Allen Hamilton executives Hayden Smith and Tim Barone, and communications professional Amanda Aguayo. Smith has also worked at Anchore. Barone had stints at BCG Digital Venture and Telos.
Risks of Supply Chain Attacks
Red Cell invited Hunted Labs to apply to its Go program in spring of 2024, after which the startup became the first company to launch to be accepted. The program is designed to help entrepreneurs with deep domain expertise incubate within the firm to validate early-stage concepts.
“Organizations today are under constant threat from attackers who hunt for vulnerabilities in the software supply chain that they can readily exploit. In fact, it is estimated that, by 2026, software supply chain attacks will cost victims almost $81 billion,” said Aguayo, who was previously a media planner for carmaker Mazda. “We created Hunted Labs to provide automated threat hunting and threat management that enable the proactive and systematic tracking, identification, and remediation of potential cybersecurity breaches, especially those that could inflict serious harm.”
Hunted Labs has won a Small Business Innovation Research Direct-to-Phase II contract totaling $1.79 million from AFWERX, the innovation unit of the Air Force. The program will support strategic advancements of the Space Development Agency and simultaneously enable the company to continue development of its Entercept product.
“The last few years have clearly shown us that when it comes to cyberattacks – whether by a nation-state actor seeking to disrupt critical infrastructure or a cybercriminal out to score a big payday – no organization is off-limits,” said Smith, a software engineer who has over a decade’s experience securing software supply chains. “When these attacks occur – often through malicious code inserted into third-party software, including open source – organizations find themselves in reactive mode and, unfortunately, by then the damage has likely already been done.”
Hunted Lab’s advisory board includes Jim Higgins, chief information security officer of CoreWeave and former CISO of Snap; Kris Merritt, former senior director of Threat Hunting Operations at CrowdStrike and former Intrusion Detection Lead for GE Aviation; and George Barnes, president of Red Cell’s Cyber Practice and former deputy director of the National Security Agency.
Ex-NSA Adviser at Helm
“In the not-too-distant past, there was a heightened push to leverage open-source software to expedite time-to-market, which often meant relegating cyber defense to backburner status. Today, however, we are seeing the consequences of not prioritizing cybersecurity as more and more entities fall prey to malicious attacks,” said Barnes. Hunted Labs will enable customers to maintain their velocity while also “assessing and mitigating risk, proving that you don’t have to compromise in the pursuit of Secure by Design,” he added.
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Red Cell was co-founded by health care and defense technology entrepreneur Grant Verstandig, investment management veteran Josh Lobel, and venture capitalist and entrepreneur John Tenet. The firm takes its name from a post-9/11 operation of the same name run by the CIA. Like that program, Red Cell aims to look anew at problems and discover innovative responses. Its leadership team includes former Secretary of Defense and former Raytheon executive Mark Esper, and Alphabet board member Roger Ferguson, who serves as chief investment officer.
The four-year-old incubator fund’s portfolio includes Eprius, Envisagenics, Red 6, Hero Health and Reveal AI. It has also incubated Zephyr AI, Savoy Life, DEFCON AI and Eyris. Red Cell’s investments came from a $91 million incubation fund (RCIF I) it closed in late 2023. So far, the incubator firm has raised over $200 million.
Verstandig, who previously founded UnitedHealth Group-acquired Rally Health, has turned his focus to national defense. He was previously a senior advisor to the National Security Agency on advanced analytics, technology and AI, and holds several patents in the three areas. Verstandig is a member of the Aspen Institute’s Cybersecurity Group, a public-private forum.
