Alphabet, Google’s parent company, has restarted negotiations to acquire cloud cybersecurity startup Wiz, The Wall Street Journal reported. This marks Google’s second attempt after failing to finalize a deal last year at a $23 billion valuation.
Google Cloud Pushes for Acquisition
Google Cloud CEO Thomas Kurian is leading the effort, recognizing Wiz’s cloud security solutions as a strategic addition to Google’s expanding portfolio. According to TechCrunch, Wiz has demonstrated impressive financial growth, reporting an annual recurring revenue (ARR) of $500 million as of July 2023. Analysts predict that this figure could reach $1 billion by 2025, making Wiz an attractive acquisition target.
Wiz’s Soaring Valuation and Key Negotiation Points
Despite its rapid growth, the $30 billion price tag represents a significant premium. Wiz last secured $1 billion in external funding in May 2023 at a $12 billion valuation, which later rose to $16 billion through an employee tender offer.
A major sticking point in past negotiations was whether Wiz would maintain operational independence or fully integrate into Google Cloud. Wiz’s co-founder and CEO, Assaff Rappaport, previously rejected Google’s offer, calling it the “toughest decision ever” while emphasizing his commitment to keeping Wiz independent.
Regulatory Scrutiny and Industry Impact
Regulatory concerns also played a crucial role in halting the previous deal, as antitrust enforcement under the Biden administration has intensified scrutiny of big-tech acquisitions.
Founded in 2020 by former Israeli military officers, Wiz has rapidly emerged as a key player in cloud security. The company has secured backing from prominent investors, including Andreessen Horowitz, Sequoia, Index Ventures, and Insight Partners.
As discussions continue, both Google and Wiz have remained silent on the potential acquisition.
