Koi Security

The hacking demo that started it all

According to a Calcalist report, the founders, Amit Assaraf, Idan Dardikman and Itay Kruk, all three veterans of Unit 8200, found a security gap in the extension marketplace of the Visual Studio Code development environment. To prove the risk, they built a fake theme extension, planted code in it that secretly sent the source code and computer details of developers who installed it to their own server, and uploaded it to the marketplace itself.

A whole category of risk: software that gets in without approval

The demo exposed a whole category of risk: browser and development-environment add-ons and extensions that employees install themselves in two clicks, outside any purchasing or approval process, and that run with full access to the machine they are installed on. For an organization, this is third-party software that got inside without anyone checking it and without anyone knowing it is there. Koi's first product, ExtensionTotal, was a public catalog that rated the risk level of extensions. Around it, the company built a platform that gives an organization visibility, risk analysis and policy enforcement over all software employees install themselves, including AI add-ons and model-based development tools.

From a Series A to $1 million in revenue

In September 2025 the company raised $38 million in a Series A round led by Battery and Team8, and according to a Calcalist report it passed $1 million in revenue within just eight months. That pace made it an attractive acquisition target less than a year after it was founded. On 17 February 2026 it was reported that Palo Alto Networks was acquiring Koi, founded in 2024. Calcalist and Globes put the deal at about $400 million at the time. The filings Palo Alto Networks itself submitted to the US Securities and Exchange Commission (SEC) give lower figures. At signing, on 16 February 2026, the company described "total consideration of $300 million in cash and replacement awards, subject to adjustments." After closing, it reported that "the total purchase consideration for the acquisition of Koi was $231 million, substantially all of which is comprised of cash." It also issued $61 million of replacement equity awards to Koi employees, which are expensed over the following years.

What Palo Alto Networks itself announced about the acquisition

On 14 April 2026 Palo Alto Networks published an official announcement on its investor relations page titled "Palo Alto Networks Completes Acquisition of Koi to Secure the Agentic Endpoint". In it, the company confirmed the completion of the acquisition and defined a new security category: "Agentic Endpoint Security" (AES), meant to secure agentic coding tools such as Claude Code and other autonomous endpoint tools. The announcement quotes Koi's CEO and co-founder, Amit Assaraf: "By joining Palo Alto Networks, we will be able to provide our customers with the most comprehensive solution for securing all AI and software on the endpoint, and across the enterprise." The press release itself does not name the deal amount. The company gave the figure in the quarterly report it filed with the SEC in June 2026: total purchase consideration of $231 million.

A recurring pattern in Israeli cyber

Koi's case illustrates a pattern that repeated itself in Israel in 2026: cyber companies one or two years old, with only dozens of employees, are acquired for hundreds of millions of dollars by established corporations that prefer to buy immediate visibility into a new risk rather than build it themselves. For the reader, the case also illustrates a change in what "enterprise software" means: in the past, software entered an organization through the IT department, and today it enters through an add-on store that any employee can install from, without approval and without a record.