Former NSA deputy director George Barnes has made his first investment as a venture capitalist for his new job at the VC incubation studio Red Cell Partners. It’s a $3 million seed deal in an open source cybersecurity startup called Hunted Labs, he told TechCrunch exclusively.
Barnes spent his entire 35-year career at the spy agency, starting as an engineer, traveling from cushy assignments in places like London to war zones, he said. He worked as deputy director from 2017 to 2023.
During that time, the “NSA had positioned itself to actually penetrate our adversaries,” he told TechCrunch. That ability to hack, “really prepares you to be a better defender,” he said adding that this is why the NSA is so good at “finding vulnerabilities and zero days.”
It’s also why he was excited to find Hunted Labs, the brainchild of Hayden Smith. Smith previously worked on DevOps and cybersecurity for various DoD projects; during his last project for the government, Smith was working on the DoD’s big Platform One project, “which was this huge software factory,” as Smith told TechCrunch.
Platform One allows the department’s programmers to deploy their apps faster with fewer approvals in large part by using already secured and cleared cloud or open source software (OSS). But one immediate question came up in its development: who is writing this OSS software?
“We don’t know what connections they have to any organization or any foreign influence,” Smith said. “There really was no product or no tool out there that could help accomplish this at scale.”
Cold email, big customer
The importance of knowing software contributors became highlighted in 2024, when a lone Microsoft engineer discovered a backdoor in xz Utils, a widely used piece of software included in just about every version of Linux. The perpetrator spent years gaining trust and covering their tracks before planting this code.
Smith wanted to create a commercial version of the background checking work he did for Platform One. So he sent cold emails to potential investors, and Barnes replied. Smith was shocked to discover he’d reached the former NSA deputy director.
Barnes liked the idea enough to invite Hunted Labs into Red Cell’s paid, three-month “discovery” period for its incubator. An incubator is somewhat like an accelerator, only the VC is more like a co-founder, bringing the outfit’s own ideas for startups to life.
Such deals may involve taking a larger stake than in a standard seed deal, but it offers more mentorship and support. Red Cell declined to say how much of Hunted Labs it controls.
In that three months, Hunted Labs refined its product enough to land customers and its $3 million seed investment from Red Cell. The startup has also already landed a $1.79 million contract with the Space Development Agency, Smith said.
Interestingly, the space agency deal didn’t come from Red Cell’s network. It came instead from the DoD connections of Smith and former DoD-project security engineer Tim Barone, who previously worked with Smith and is a co-founder of Hunted Labs, along with Smith’s wife Amanda Aguayoco. (“I have a cooling off period — that’s two years for DoD,” said Barnes, referring to why he isn’t directly involved in sales.)
But the founders are known to many in the massive department, so unlike many Silicon Valley-born defense tech startups, they don’t need such warm intros to government buyers, anyway.
“They are recognized professionals in their own right, and so that actually opens doors,” Barnes said.
Hunted Labs also provides more traditional OSS software threat management, like identifying the software in use and spotting vulnerabilities in the code. In this space, it has plenty of competition like Black Duck Software, Mend.io, and Snyk.
