Wiz out of acquisition deal with Google’s $23B deal, the CEO emails personally

A person familiar with the talks claims that Alphabet, Google’s parent company, made a $23 billion buyout offer to cybersecurity startup Wiz, which Wiz rejected down.

With the backing of investors, Wiz’s management team has chosen to stay independent even though the offer represents a significant premium above its most recent private valuation of $12 billion, the individual stated.

According to Rappaport, the business would concentrate on achieving its next goals, which include an IPO and $1 billion in recurring revenue annually. The company had been pursuing these objectives long before the reports of discussions surfaced.

The startup’s $12 billion valuation from its most recent investment round would have almost doubled as a result of the deal. Wiz was established in 2020, and under Rappaport, it has expanded quickly. Rappaport had been considering an IPO as late as May.

The following email was issued to Wiz’s 1200 workers worldwide by CEO Assaf Rappaport:

“Wizards,

I know the last week has been intense, with the buzz about a potential acquisition. While we are flattered by offers we have received, we have chosen to continue on our path to building Wiz.

Let me cut to the chase: our next milestones are $1 billion in ARR and an IPO.

Saying no to such humbling offers is tough, but with our exceptional team, I feel confident in making that choice.

The market validation we have experienced following this news only reinforces our goal – creating a platform that both security and development teams love. We are grateful for the faith our employees, investors, and customers have in us as we build the best cybersecurity company in the world.

Thank you for your hard work and focus during these days, which helped us stay on track and finish the quarter stronger than ever. As we always say: LFG.

Assaf”

The New York-based business was expected to be Alphabet’s largest transaction to date and its second significant cybersecurity acquisition after the $5.4 billion acquisition of Mandiant in 2022.

Wiz, a software startup with rapid growth, raised $1 billion in a private fundraising round earlier this year, valuing the company at $12 billion. approximately 2023, the Israeli-American startup brought approximately $350 million in sales.

With artificial intelligence-powered real-time threat detection and response capabilities, Wiz offers cloud-based cybersecurity solutions that assist businesses in identifying and eliminating significant threats on cloud platforms.

The Wiz acquisition would have assisted Alphabet’s cloud division, which has been under pressure to expand in the face of competition from market leaders Microsoft and Amazon. The cloud unit turned a profit in 2023 following years of significant expenditure.