Relyance Secures $32M Funding to Assist Companies in Meeting Data Compliance Regulations

As the demand for artificial intelligence (AI) skyrockets, AI vendors are dedicating more resources to address data security challenges. They are not only required to adhere to evolving data privacy regulations, such as the EU Data Act, but are also facing scrutiny from clients concerned about how their data is utilized and processed.

Unfortunately, many organizations struggle to enhance their data security practices in the realm of AI. A survey conducted by BigID, a data control platform, revealed that 50% of organizations identify data security as their primary obstacle to AI implementation.

From their backgrounds in app engineering and law, Abhi Sharma and Leila Golchehreh have firsthand experience with these challenges. Believing they could develop a solution to the data security dilemma, they launched Relyance AI—a platform designed to ensure that a company’s data usage aligns with governance policies.

“Our idea for Relyance came to us one night while sharing a pizza in San Francisco,” Sharma explained. “Though we came from different fields, we recognized the need for greater visibility into how organizations process data.”

Golchehreh, an attorney, previously served as senior counsel for Workday and autonomous vehicle startup Cruise. Sharma, a software developer, was a platform engineer at AppDynamics before co-founding FogHorn, an edge AI platform acquired by Johnson Controls in 2022.

Sharma notes that companies typically contend with three major barriers to AI integration: limited visibility into data used by AI, the complicated handling of data, and the rapid pace of innovation. These factors contribute to reputational risks and expose companies to potential legal challenges.

Relyance offers a powerful solution that scans an organization’s data sources—including third-party applications, cloud environments, AI models, and code repositories—to ensure compliance with established policies. The platform generates a “data inventory” and a “data map,” synchronizing them with customer agreements, global privacy laws, and compliance frameworks.

“Relyance empowers organizations to monitor external vendor risks,” Sharma stated, “while our data lineage feature tracks data flows across applications to proactively identify potential threats.”

Although Relyance isn't entirely pioneering the concept, Sharma acknowledges that it competes with established vendors like OneTrust, Transcend, DataGrail, and Securiti AI. For instance, DataGrail provides automated risk-monitoring tools that help companies swiftly assess third-party app risks.

Nonetheless, Relyance is making significant strides in the market. Sharma asserts that the company is on pace to double its annual recurring revenue this year, with its customer base—including notable names like Coinbase, Snowflake, MyFitnessPal, and Plaid—growing by 30% in the first half of the year.

To further accelerate its growth, Relyance recently secured $32 million in a Series B financing round led by Thomvest, with participation from M12 (Microsoft’s venture fund), Cheyenne Ventures, Menlo Ventures, and Unusual Ventures. This brings the startup's total funding to $59 million. The new investment will facilitate the expansion of Relyance's workforce to 90 employees by year-end.

“We chose to raise funds because of the escalating demand for AI and the implementation of new privacy and AI regulations worldwide,” Sharma stated. “Our hiring efforts will primarily focus on bolstering our engineering team and enhancing our go-to-market capabilities to support our product development and growth momentum.”