Google parent Alphabet is in advanced talks to acquire cybersecurity startup Wiz for roughly $23 billion, according to people familiar with the matter, in what would be the largest acquisition ever, Wall Street Journal reported.
Alphabet is eyeing the deal at a time of intense antitrust scrutiny of the search company and other tech giants. The acquisition could also help boost Alphabet’s efforts in cloud computing, an important and growing business but one where it has lagged behind peers.
Wiz’s valuation has soared since it was founded in 2020 by Chief Executive Assaf Rappaport and several colleagues. The company, which offers cybersecurity software for cloud computing, raised $1 billion earlier this year at a valuation of $12 billion. It is one of only a few startups outside the artificial-intelligence industry to raise money at a higher valuation in 2024.
Wiz said it hit $100 million in annual recurring revenue after 18 months, and achieved $350 million in annual recurring revenue in 2023. The company is backed by prominent Silicon Valley venture capitalists, including Sequoia Capital, Andreessen Horowitz, Index Ventures, and Lightspeed Venture Partners.
A Wiz acquisition would dwarf the size of Google’s largest deal to date, its $12.4 billion purchase of Motorola Mobility that closed in 2012. Google also spend $2.1 billion on Fitbit in 2012 — a deal that hit regulatory hurdles after it was announced — and $3.2 billion on Nest Labs in 2014. Other acquisitions over the years have included YouTube, DoubleClick, Looker, and Waze.
CNBC reported Wiz was founded in 2020, and has grown at a rapid clip under CEO Assaf Rappaport. It had been eyeing an IPO as recently as May, when the company achieved a valuation of $12 billion.
Wiz’s cloud security offering gives executives and cybersecurity professionals inside into the company’s full cloud presence, something appealing to large firms with significant computing resources. It is back by a roster of blue chip firms, including Israeli VC firm Cyberstarts, Index Ventures, Insight Partners and Sequoia Capital.
If completed, the deal would be Google’s largest ever acquisition. It would also underline a clear and continued bet on cybersecurity, at a time when the nation state and criminal actors have managed to disrupt governments and large organizations. Google has made large cyber acquisitions before: The company acquired cybersecurity firm Mandiant for $5.4 billion two years ago.
Reuters reported Google parent Alphabet is in advanced talks to acquire cybersecurity startup Wiz for roughly $23 billion, a person familiar with the matter said Sunday, in a deal that would represent the technology giant’s biggest acquisition ever.
The deal, being funded mostly in cash, could come together soon, the source added, speaking on behalf of anonymity. Wiz, founded in Israel and now headquartered in New York, is one of the fastest growing software startups globally, providing cloud-based cybersecurity solutions with real-time threat detection and responses powered by artificial intelligence.
In my opinion, if this deal goes through, it could help Alphabet to grow bigger. We will have to wait and see what happens. To me, it seems like a deal this large could become a problem for Google.