System Two Security, a cutting-edge cybersecurity startup, has announced a $7 million funding round led by Costanoa Ventures. Runtime Ventures, The Hive, Webb Investment Network, and prominent tech veterans, including Scott McNealy (former CEO of Sun Microsystems), Frederic Kerrest (Co-Founder of Okta), and Ash Devata (CEO of GreyNoise), also participated in the round. The funding marks a significant milestone in System Two’s mission to help security teams combat the rising tide of GenAI-powered cyberattacks with their own GenAI-enhanced solutions.

Meeting the Generative AI Challenge

The cybersecurity landscape is undergoing a seismic shift with the widespread adoption of generative AI (GenAI) in cybersecurity attack.

GenAI  is being used by cyber attackers to make their attacks faster, smarter, and harder to detect by exploiting vulnerabilities in creative and automated ways. Attackers can generate code to bypass security measures, automate brute-force attacks on passwords, or manipulate AI models used in defenses to behave unpredictably.

GenAI tools can also simulate attack scenarios, helping hackers identify weak points in systems, and create malware that adapts in real-time to avoid detection. This capability allows attackers to breach systems more efficiently and launch sophisticated attacks with minimal effort.

System Two Security is tackling this challenge head-on. By leveraging purpose-built GenAI models and agents designed specifically for detection engineering, the company transforms threat detection from a manual, time-intensive process into an adaptive and automatic system. Early design partners have seen up to 10x faster detection of new threats, including sophisticated attacks like LLMJacking.

“Our vision is simple: to ensure that defenders can outpace attackers by turning AI into a force multiplier for security teams,” said Robert Fly, CEO of System Two Security. “The bad guys have new weapons, and it’s time for the good guys to match their speed and adaptability.”

Advanced Detection Engineering

System Two’s groundbreaking technology focuses on:

• AI-Native Detection Models: Unlike traditional tools patched with AI enhancements, System Two’s solutions are built from the ground up to fully exploit GenAI capabilities.
• Automatic Detection Creation: The platform’s AI agents draft new detections in minutes, filling gaps in security coverage and adapting to new threats with remarkable speed and precision.
• Cross-System Compatibility: System Two integrates seamlessly with major enterprise security platforms, including Splunk, Microsoft Sentinel, and CrowdStrike’s Next-Gen SIEM.
• Empowering Detection Engineers: By automating repetitive tasks and streamlining complex processes, the platform frees engineers to focus on high-value activities.

The company’s unique approach combines threat actor behavior graphs, enterprise context embeddings, and specialized large language models (LLMs) to predict and identify emerging threats with zero-shot accuracy. This reimagining of LLM technology for cybersecurity sets System Two apart from other solutions.

Driving the Future of the Security Operations Center (SOC)

System Two’s commitment to SOC transformation is rooted in a philosophy of empowerment rather than replacement. The platform’s generative AI agents augment human expertise, enabling security teams to:

• Identify and address coverage gaps efficiently.
• Transition detection rules between systems without vendor lock-in.
• Anticipate novel attack sequences through predictive modeling.

“System Two isn’t just another vendor promising a black-box solution,” said Fly. “We’re partners in helping teams navigate the complexities of today’s threat landscape with tools that make their jobs easier and their defenses stronger.”

A Visionary Team with Deep Expertise

Founded in 2023 by industry veterans CEO Robert Fly and CTO Prasanth Ganesan, System Two brings decades of experience in security innovation. Fly, a serial entrepreneur and former CEO of Elevate Security, and Ganesan, a technical leader with expertise in SIEM, XDR, EDR, and AI, have built a company dedicated to transforming how organizations approach cybersecurity.

The company’s name, inspired by Daniel Kahneman’s behavioral science framework in Thinking, Fast and Slow, reflects its deliberate and logical approach to solving complex cybersecurity challenges. This ethos is embodied in System Two’s AI-driven solutions that empower detection engineers to achieve more with less.

Scaling for Impact

With the $7 million funding, System Two plans to expand its team and accelerate product development. The company is actively seeking design partners to refine its technology and deliver even greater value to security teams. Companies interested in participating can contact System Two at info@systemtwosecurity.com.

Redefining Security with Generative AI

System Two’s approach represents a new way to fight cybercrime. By turning GenAI from a threat into an advantage, the company empowers organizations to stay ahead of attackers in a rapidly evolving landscape.

“We’re thrilled to back a team with the expertise and vision to lead this transformation,” said John Cowgill, General Partner at Costanoa Ventures. “System Two is poised to redefine detection engineering and deliver the tools defenders need to succeed.”

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