Wiz, an Israeli cybersecurity firm, has declined a $23 billion takeover offer from Google parent company Alphabet. This would have been Alphabet’s largest-ever acquisition.
SCOOP: Wiz, the $12 billion cloud security startup that was in acquisition talks with Google, has decided not to move forward with the deal. This is a developing story, more below.https://t.co/aXZjtUDS1e
— Allie Garfinkle (@agarfinks) July 23, 2024
According to an internal memo, Wiz’s founder and CEO Assaf Rappaport told employees that while the offer was flattering, the company aims to achieve $1 billion in revenue before considering going public.
MAJOR NEWS: Google's deal to acquire Wiz is dead. The company plans to pursue an IPO instead. w/ @jenn_elias @jordannovet @CNBC https://t.co/liAisxQmBi
— Rohan Goswami (@rogoswami) July 23, 2024
A source close to the negotiations said the offer was “very tempting,” but Wiz is confident in its ability to grow independently and become the world’s leading cybersecurity company. Earlier this year, Wiz reported an annual recurring revenue of $500 million, up significantly from $100 million in annual revenue within its first 18 months of operation. “I know the last week has been intense, with the buzz around a potential acquisition,” Mr.
Rappaport said in the memo.
When you put limits on acquisitions, it becomes easier for successful businesses to raise other forms of capital and stay independent.
See: Wiz walking away from a Google acquisition to pursue an IPO https://t.co/rJv1ujb9OQ
— Open Markets Institute (@openmarkets) July 24, 2024
“While we are flattered by the offers we have received, we have chosen to continue on our path to building Wiz.”
Wiz will now focus on preparing for an initial public offering (IPO), which would see the company listed on a stock exchange. Wiz is the third venture by Assaf Rappaport and his co-founders Ami Luttwak, Roy Reznik, and Yinon Costic, who first worked together in the Israeli military’s intelligence unit.
Wiz focuses on IPO preparation
This unit has produced many of Israel’s top cybersecurity firms, such as Check Point, Palo Alto Networks, and Armis. In 2012, the founders started a cybersecurity company called Adallom, which Microsoft bought for $320 million three years later.
The team then joined Microsoft to work on security products. They left Microsoft and founded Wiz in March 2020. Commentators have said the founders’ previous work at Microsoft is a reason for Alphabet’s strong interest in buying Wiz.
In May, Wiz was valued at $12 billion during a $1 billion funding round. “This is the mindset we need in Europe,” Neil Shah, head of tech at the London Stock Exchange, said in a LinkedIn post. “The founders of Wiz walk away from a billion-dollar payday and have put it back on the roulette table in the hope of a more rewarding outcome in the long term.
They saw where the value went last time when they sold. Good luck to them.”
Wiz has offices in New York, Tel Aviv, and three other locations in the United States, according to its website.
Cameron is a highly regarded contributor in the rapidly evolving fields of artificial intelligence (AI) and machine learning. His articles delve into the theoretical underpinnings of AI, the practical applications of machine learning across industries, ethical considerations of autonomous systems, and the societal impacts of these disruptive technologies.
