Cloaked Raises $375M to Fight for Privacy in the Age of AI

In a market where data breaches have become routine and AI-powered scams are escalating at an alarming rate, consumer privacy startup Cloaked has closed a massive $375 million Series B round — signaling that investor appetite for privacy-first technology has reached a new high.

Announced on March 19, 2026, the round was co-led by General Catalyst and Liberty City Ventures, with participation from an impressive roster of investors including Lux Capital, Human Capital, DuckDuckGo, LG Technology Ventures, and the NFL Players Association. The funding represents a dramatic leap from the company's prior total raise of just over $29 million, underscoring the velocity of Cloaked's growth trajectory.

The Brothers Behind the Platform

Cloaked was founded in 2020 by brothers Arjun Bhatnagar (CEO) and Abhijay Bhatnagar (CTO), both in their 20s at the time of founding. The duo comes from an entrepreneurial family — their father runs a transportation software company and their mother oversees an after-school education center.

This isn't their first venture together. The Bhatnagar brothers previously co-founded Hey! HeadsUp, which they sold in 2016. Arjun has also taught programming at MIT, served as a partner at a venture capital firm, and founded a nonprofit for underserved communities. As Arjun puts it: "From Legos to startups, we've been building things together for a long time."

The company's origin story is telling. Arjun was developing an AI system to analyze personal data streams when the system inadvertently accessed private communications — a moment that crystallized the urgent need for tools that give consumers real control over their personal information.

What Cloaked Actually Does

At its core, Cloaked gives users complete control over when, where, and with whom they share personal data. Available across web, browser extension, and mobile app, the platform offers an integrated suite of privacy tools:

• Virtual Identities: Generate unlimited unique email addresses, phone numbers, and passwords for every website, app, or transaction — eliminating the need to expose real personal data
• Data Broker Removal: Automatically scrubs personal information from broker databases, cutting off the supply chain that feeds scammers and aggressive marketers
• AI-Powered Call Screening: Since launch, the feature has processed over 50 million scam or spam phone calls
• Dark Web Monitoring: 24/7 surveillance for exposed SSNs, phone numbers, emails, and home addresses across the dark web
• Encrypted VPN: End-to-end encrypted WireGuard VPN that blocks ISP snooping and ad trackers
• Cloaked Pay: Transaction security features (with additional capabilities forthcoming)

The technical foundation is robust. Cloaked operates on a zero-knowledge architecture with AES-256 encryption, meaning even Cloaked itself cannot access user data. The company holds ISO 27001 and ISO 27701 certifications, maintains PCI-DSS compliance, and has completed independent annual SOC 2 Type II audits.

Inside the $375M Round

The structure of this raise is noteworthy. It's not a straightforward equity round — it combines Series B equity investment with growth financing.

General Catalyst contributed through its Customer Value Fund, a vehicle designed to provide startups with non-dilutive capital specifically for customer acquisition. This structure is strategically significant: it allows Cloaked to pursue aggressive growth without excessive founder dilution, preserving equity upside while fueling expansion.

Full investor lineup:

• Co-leads: General Catalyst, Liberty City Ventures
• Participants: Lux Capital, Human Capital, Marquee Ventures, Fifth Growth Fund, NFL Players Association, LG Technology Ventures, Assurant Ventures, DuckDuckGo

While valuation wasn't disclosed, the magnitude of the jump — from ~$29M total prior funding to a single $375M round — suggests a substantial valuation increase, likely reflecting the company's 10x growth.

Growth Metrics That Caught Investors' Attention

The numbers tell a compelling story:

• 10x year-over-year growth
• 350,000+ paying customers
• 10 million identities protected
• 1 billion+ records cleaned from data broker sites
• 50 million+ scam/spam calls processed through AI screening

For a consumer privacy product — a category that historically struggled with monetization — securing 350,000 paying customers is a powerful signal of product-market fit. The 10x growth rate places Cloaked firmly in the top tier of B2C SaaS scaling trajectories.

Market Context: Privacy Tech's Inflection Point

Cloaked's mega-round arrives at a pivotal moment for the privacy technology sector. The global data privacy software market is projected to grow from $7.54 billion in 2026 to $60.4 billion by 2034, representing a CAGR of approximately 29.7%. The privacy-enhancing technologies (PET) market alone is expected to reach $14.3 billion by 2030.

Three forces are converging to create this tailwind:

AI-driven threats are multiplying. Deepfakes, AI-generated phishing attacks, and automated social engineering have made personal data more vulnerable than ever. The very technology creating these threats is also powering Cloaked's defensive tools — a compelling narrative for investors.

Regulatory pressure continues to intensify. With data protection laws tightening globally, both individuals and enterprises face increasing compliance requirements that make privacy tools not just nice-to-have but essential infrastructure.

Consumer awareness has hit critical mass. Years of high-profile breaches — from healthcare systems to financial institutions — have shifted consumer attitudes from passive acceptance to active data protection. People are willing to pay for privacy, and Cloaked's paying customer base proves it.

Competitive Landscape

The privacy protection space features several established players, but most compete in narrow verticals:

• DeleteMe (owned by Abine): Specializes in data broker removal through manual opt-out requests, but practical coverage is limited to approximately 181 brokers
• IronVest (also Abine, formerly Blur): Focused primarily on financial security via browser extension
• Incogni (Surfshark): Data removal service with a more limited feature set
• Aura: Comprehensive digital security platform targeting identity protection

Cloaked's competitive advantage lies in its all-in-one approach. While competitors typically address one slice of the privacy problem — data removal, password management, or VPN — Cloaked integrates virtual identity generation, data broker removal, call screening, VPN, dark web monitoring, and payment security into a single platform. The zero-knowledge architecture provides additional technical differentiation that's difficult for competitors to replicate without rebuilding from the ground up.

Strategic Roadmap: The Enterprise Play

The most consequential strategic decision embedded in this funding is Cloaked's expansion into enterprise. The company plans to offer businesses employee-facing privacy tools built on the same technology stack that powers its consumer product:

• Identity and password management for employees
• Scam detection alerts
• Per-user risk level visibility
• Aggregated security dashboards (records cleaned, scams blocked)
• Data exposure monitoring across the organization

This consumer-to-enterprise expansion follows a proven product-led growth (PLG) playbook. Employees who already use Cloaked personally become internal advocates for company-wide adoption — a bottom-up distribution strategy that has worked exceptionally well for companies like Slack, Dropbox, and Figma.

Beyond enterprise, Cloaked is also investing in:

• Text message screening and email filtering
• Browsing protection
• An AI agent for automated breach response
• International expansion
• Team growth across product, engineering, and enterprise sales (currently ~70 employees)

Why Investors Made This Bet

General Catalyst's decision to not only lead the equity round but also deploy its Customer Value Fund signals deep conviction in Cloaked's trajectory. DuckDuckGo's participation adds strategic significance — the privacy-focused search engine's investment suggests potential ecosystem synergies and validates Cloaked's positioning within the broader privacy movement.

The investor thesis is built on several pillars: proven traction with 10x growth, a platform architecture that naturally extends from consumer to enterprise, powerful macro tailwinds from AI-driven threats, and a capital-efficient growth model enabled by non-dilutive financing. The participation of non-traditional investors like the NFL Players Association and LG Technology Ventures further signals that privacy protection is evolving from a niche concern into a universal demand across industries.

What to Watch

Cloaked's $375 million Series B marks a watershed moment for the consumer privacy sector, validating the thesis that privacy is no longer a niche — it's a mainstream category. The key questions going forward center on three areas: whether the enterprise expansion can replicate the consumer product's traction, how quickly Cloaked can scale internationally, and whether the all-in-one platform strategy can maintain a durable competitive moat against both point-solution competitors and potential big-tech entrants. With nearly half a billion dollars in total funding and 10x growth momentum, Cloaked has the resources and trajectory to become a defining company in the privacy technology space. For investors and industry watchers alike, this is a story worth following closely.