Dam Secure, an AI security startup based in Sydney and San Francisco, has raised $4 million in seed funding to address the security risks posed by AI-generated code entering production environments. The round was led by Paladin Capital Group, a Washington, D.C.-based investor focused on cyber and AI.
Founded by Patrick Collins and Simon Harloff, Dam Secure is building what it describes as an AI-native platform designed to help organizations proactively manage the expanding attack surface created by widespread adoption of generative coding tools. The company argues that traditional application security processes are increasingly overwhelmed as AI accelerates developer output, and that conventional scanners often fail to catch logic-level weaknesses that can be introduced even when code “works” as intended.
Dam Secure’s approach centers on enabling security teams to define requirements in plain English—such as ensuring sensitive customer data is encrypted at rest—and then automatically enforcing those rules across large codebases throughout the development lifecycle. The company positions this as a way to reduce the noise created by existing tools while improving detection of subtle, valid-but-dangerous logic flaws that may not match known vulnerability patterns.
Paladin Capital Group Managing Director Mourad Yesayan will join Dam Secure’s board as part of the investment. Yesayan said Paladin backed Dam Secure based on the founders’ experience building security products within fast-growing technology companies and the firm’s view that application security needs new guardrails as developers become more reliant on AI-generated code.
Collins previously held executive roles at Zip Payments and Secure Code Warrior, and earlier founded and exited mobile technology company 5th Finger. Harloff has led product security teams at Zip Payments and Secure Code Warrior and is responsible for Dam Secure’s technical architecture.
Dam Secure said it has already generated significant customer interest across multiple industry verticals and plans to use the funding to accelerate product development and expand go-to-market efforts throughout 2026.
KEY QUOTES:
“Enterprises are rushing to adopt AI to increase developer velocity, but the volume of software being produced is overwhelming traditional application security processes. Existing security tools generate too much noise to work effectively in this new environment.”
“Industry research shows that, when not explicitly constrained, large language models introduce vulnerabilities in up to half of generated code. This creates dangerous ‘logic gaps’ that organizations are largely blind to. We are already seeing the cost of this in recent billion-dollar heists and widespread ecosystem attacks. These breaches don’t rely on classic bugs, they exploit valid but flawed logic that existing ‘scan-and-patch’ tools simply cannot see.”
Patrick Collins, Co-Founder, Dam Secure
“The current approach to application security is struggling to keep pace with generative AI. Developers are becoming increasingly reliant on AI-generated code, and Dam Secure is focused on putting guardrails around that workflow.”
Mourad Yesayan, Managing Director, Paladin Capital Group
