As generative AI explodes across workplaces, a new class of infrastructure is emerging to tame the chaos. Unbound, a San Francisco-based startup, has secured a $4 million seed round to help enterprises embrace AI on their own terms—safely, observably, and cost-effectively.
The round was led by Race Capital, with support from Wayfinder Ventures, Y Combinator, Massive Tech Ventures, and a notable roster of angels including Google board member Ram Shriram and cybersecurity veterans from Cloudflare and Palo Alto Networks. The company is positioning itself at the forefront of AI governance—an increasingly urgent sector as businesses grapple with AI adoption at scale.
The Shadow IT Crisis of AI
From marketing teams using ChatGPT to engineers running code through Copilot, AI tools have become indispensable—and often ungoverned. This “shadow AI” adoption is introducing real risks: leaking proprietary data, racking up unmonitored costs, and introducing third-party models without security reviews. IT teams are often left in the dark, unable to enforce policy or protect sensitive data.
Unbound was born out of this problem. The platform acts as an AI Gateway, a secure middleware layer that integrates directly with popular enterprise AI tools such as Cursor, Roo, and internal document copilots. Rather than blocking access to generative models, Unbound introduces fine-grained controls, real-time redaction, model routing, and robust usage analytics—all without breaking existing workflows.
AI Redaction and Model Routing—Explained
One of Unbound’s most innovative features is real-time prompt redaction. When users interact with AI tools, Unbound scans requests for sensitive content like passwords, API keys, or personal data. Instead of flagging or blocking them (as traditional Data Loss Prevention tools do), the system automatically redacts secrets and routes sensitive prompts to internal models hosted on platforms like Google Vertex AI, AWS Bedrock, or private LLMs inside the enterprise’s secure environment.
This architectural decision reflects a growing trend: treating AI traffic like network traffic, complete with routing, failover, observability, and cost controls.
Unbound’s routing logic is powered by usage patterns and model performance metrics. For instance, high-stakes requests (such as infrastructure code generation) can be routed to top-tier models like Gemini 2.5, while lighter tasks (e.g., grammar editing) are offloaded to open-source LLMs—cutting down on unnecessary premium license usage.
In practice, this capability translates into measurable results. Early adopters in the tech and healthcare sectors have used Unbound to:
- Prevent over 7,000 potential data leaks, including secrets, credentials, and PII.
- Achieve up to 90% detection accuracy for sensitive content.
- Cut AI seat license costs by up to 70%, thanks to smart routing and model optimization.
Instead of buying blanket licenses, companies can selectively provision access, ensuring model usage aligns with business priorities.
Founders with Deep Security and Infrastructure DNA
Behind the platform are co-founders Rajaram Srinivasan (CEO) and Vignesh Subbiah (CTO)—both veterans of enterprise software and security. Srinivasan previously led data security product teams at Palo Alto Networks and Imperva, while Subbiah helped scale platforms from seed to growth stage at Tophatter and Shogun before joining Adobe.
Their mission was clear: build a system that enables AI innovation without compromising enterprise-grade security. “Blanket bans on AI tools are outdated,” said Subbiah. “With Unbound, we provide surgical security controls for every AI request—allowing enterprises to move fast, without breaking trust.”
From Chaos to Coordination in the AI Stack
The broader market is validating Unbound’s vision. As enterprise AI usage grows, so too does the need for centralized management, transparency, and fail-safes. Recent studies estimate the global AI governance industry will balloon from $890M in 2024 to $5.8B by 2029—a 45% CAGR.
Unbound is positioning itself as mission-critical infrastructure in this new stack. Features like redundant routing during LLM downtime (when providers like OpenAI or Anthropic experience throttling), team-level usage analytics, and per-request model orchestration transform AI adoption from a free-for-all into a controlled, intelligent system.
“Think of us as the reverse proxy for enterprise AI,” said Srinivasan. “We sit between users and models, ensuring privacy, performance, and cost-efficiency—without friction.”
What’s Next for Unbound
With this funding, Unbound plans to:
- Expand integrations across 50+ enterprise AI applications.
- Add deeper observability features for team and department-level insights.
- Support full orchestration of internal and open-source models across confidential computing environments.
In a world where every department is becoming an AI power user, Unbound provides the infrastructure to keep that power in check—and in line with business objectives.
“We’re proud to back Rajaram, Vignesh, and the team,” said Edith Yeung, General Partner at Race Capital. “Unbound is building the AI governance layer that enterprises desperately need—safe, observable, and built for the real world.”
As generative AI continues to expand across enterprise workflows, the demand for tools that manage its risks is growing in parallel. Unbound’s $4M seed round reflects a broader shift in the industry toward building infrastructure that can bring visibility, control, and governance to AI adoption. With growing interest in secure, adaptable AI frameworks, Unbound joins a rising cohort of startups addressing the complex challenge of integrating AI responsibly at scale.
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