Why We Invested in Prediction Guard

As enterprise adoption of generative AI (GenAI) accelerates, so do concerns surrounding privacy, data leakage, and regulatory compliance. Nearly 1 in 4 organizations have banned GenAI outright amid growing security fears, and 60% of Fortune 500 AI leaders are actively exploring open-source, self-hosted alternatives. Prediction Guard sits at the forefront of this shift.

At Blu Venture Investors, we’re backing the infrastructure companies that will make AI both transformative and trustworthy. Prediction Guard provides a scalable, secure GenAI platform purpose-built for regulated and privacy-conscious entities. 

About Prediction Guard

Prediction Guard is a GenAI infrastructure platform that enables enterprises to deploy AI models securely in self-hosted environments – on-prem, in a VPC, or at the edge. The platform includes robust security controls such as prompt injection filtering, hallucination scoring, PII redaction, and real-time model validation, all aligned with standards like HIPAA and SOC2. Deal lead Mike Denning notes that Prediction Guard “has a very elegant solution that helps corporations maintain control of the environment and the data without sacrificing the performance capability and creativity that AI can have for their business.”

Unlike wrapper solutions or generic copilots, Prediction Guard was built to support mission-critical AI use cases with infrastructure-grade reliability. It is compatible with both Intel and NVIDIA hardware, open-source or proprietary models, and integrates easily into existing developer workflows.

Inside Look at Blu’s 5 Ts for Prediction Guard

Team:

CEO Daniel Whitenack and CTO Adam Cuzzort are seasoned operators with complementary strengths. Dan brings technical depth, community influence (via his Practical AI podcast with 1.5M+ annual listeners), and a deep knowledge of the customer journey. Adam has successfully led and exited multiple enterprise software companies and brings experience in scaling secure systems.

The team has executed with exceptional capital efficiency, partially due to the low-cost marketing channel created by Dan’s podcast. Mike Denning believes that the podcast “creates a halo effect overall on the market, but also creates this ability for [Dan] to solicit new ideas and get more of a grassroots marketing brand awareness for Prediction Guard.” 

The operational discipline and credibility in both open-source and enterprise AI make Prediction Guard’s founders uniquely qualified to build this product.

Technology:

Prediction Guard offers a vertically integrated AI platform with system-level security. Key features include:

• Support for customer-managed, PG-managed, or embedded deployments

• Real-time observability and monitoring

• A full audit log of all AI system changes and updates

• Configurable guardrails (PII filtering, prompt injection protection, hallucination scoring)

• BYO-model architecture compatible with pre-trained and fine tuned source LLMs

• Admin tooling for model governance and security configurations

The company has filed two patents in inference safeguarding and privacy-preserving model deployment. These innovations provide an end-to-end solution that simplifies secure AI adoption across regulated sectors.

Traction:

Since launching its first pilot in July 2023, Prediction Guard has scaled its client base to organizations in healthcare, defense, manufacturing, and financial services. Some of its largest customers include a leading provider of aerospace & defense manufacturing software, IMB, Purdue University, Cultura, and Modaxo.

Mike Denning highlights what initially drew his attention to the company, stating that “they already have a pretty good early stage revenue that’s growing really quickly and a very high conversion rate. With de minimis marketing to date, they’ve grown their revenue to something that could justify a larger [funding] round.”

The company’s GTM approach thus far has centered on founder-led evangelism through podcasts, conferences, and partnerships. It’s now expanding into channel and partner-led sales with integrations into low-code platforms like Chipp.ai and a growing set of MSP and system integrator relationships.

The product is being used in high-stakes scenarios – from supporting medics and emergency responders, to hosting secure multilingual AI assistants for global nonprofits. Customers consistently cite PG’s responsiveness, reliability, and configurability as key differentiators.

TAM (Total Addressable Market):

Prediction Guard addresses a $21.1B TAM in enterprise GenAI infrastructure. Growing demand for open-source AI, heightened scrutiny around data privacy, and enterprise pressure to move away from cloud-hosted black-box AI solutions all position the company for explosive growth. With a first-mover advantage and hardware-agnostic architecture, Prediction Guard offers a compelling platform for secure AI adoption.

Terms:

Blu Venture Investors is participating in a $3.7M oversubscribed seed funding round led by Sovereign’s Capital. The funds will support key hires across sales, marketing, and DevSecOps, as well as platform enhancements including edge deployment tooling and marketplace integrations. 

Our Perspective

Prediction Guard is building critical infrastructure for a new era of AI in which security, privacy, and governance are non-negotiable. With a standout team, strong early traction, and a differentiated platform, the company is well-positioned to become the trusted GenAI layer for regulated enterprises.

At Blu, we believe Prediction Guard can define this category, and we’re proud to be on the journey.