Wiz Inc. has reportedly ended discussions with Google LLC about an acquisition that could have valued the cybersecurity startup at $23 billion.
The Wall Street Journal and CNBC reported the development today, citing an internal Wiz memo. Chief Executive Officer Assaf Rappaport (pictured, second from the left) wrote in the note that “saying no to such humbling offers is tough, but with our exceptional team, I feel confident in making that choice.”
Wiz will now reportedly shift its focus to laying the groundwork for an initial public offering. In May, Rappaport told the Journal that the cybersecurity company hopes to achieve annual recurring revenue of $1 billion before listing its shares. Wiz’s annual recurring revenue is reportedly already above $500 million, up from $350 million last year and $100 million in August 2022.
The company’s rapid sales growth is likely one of the reasons behind the steep price it was expected to fetch from Google. The $23 billion that the search giant could have reportedly paid is nearly twice the valuation that Wiz received after its most recent funding round, a $1 billion raise it announced in May. Including that investment, the cybersecurity provider has raised a total of $1.9 billion from investors to date.
A source told CNBC that “antitrust and investor concerns” factored into Wiz’s decision not to sell. Google is currently facing an antitrust lawsuit in the US, as well as a European Union probe into its compliance with the bloc’s tech industry regulations. Wiz executives may have been concerned that an acquisition would have struggled to receive approval from antitrust officials.
Since launching in 2020, Wiz has built a broad cloud security platform that combines several breach prevention tools into a single product. The software scans cloud environments for vulnerabilities as storage buckets that can be accessed over the open web. It also spots attempts by hackers to exploit those vulnerabilities and provides features for several related tasks, such as ensuring a company complies with GDPR data privacy regulation.
Wiz can find security issues in not only cloud instances but also other off-premise technology assets. The platform detects security issues in serverless functions, snippets of code that run without much of the software scaffolding needed for traditional applications, and container registries. A container registry is a kind of internal app store that a company’s developers use to share frequently used software components.
Wiz provides automation workflows that promise to reduce the amount of time involved in tackling breaches. According to the company, those workflows speed up tasks such as collecting technical data about a cyberattack. The end result is a reduction in the amount of time necessary to remove malware from cloud environments .
For securing cloud-based artificial intelligence models, Wiz provides a suite of features known as AI-SPM. It can detect cases when employees have unnecessarily broad access to an AI model’s source code. AI-SPM also spots other issues, such as misconfigured security settings that may make an instance with AI training data susceptible to hacking.
Wiz says that its platform is used by more than 40% of the Fortune 500. According to the company, those customers run 230 billion cybersecurity scans every day across five million cloud workloads.
The acquisition of Wiz wouldn’t have been Google’s first major purchase in the cybersecurity market. In 2022, the search giant bought cybersecurity services provider Mandiant for $5.4 billion. Mandiant, which now operates as a unit of Google Cloud, helps companies detect and remediate breaches.
Photo: Wiz
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{Categories} _Category: Takes{/Categories}
{URL}https://siliconangle.com/2024/07/23/wiz-reportedly-ends-23b-acquisition-talks-google/{/URL}
{Author}Maria Deutscher{/Author}
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{Keywords}NEWS,Security,acquisition,breach prevention,cloud security,cybersecurity,google,Mandiant,startup,Wiz{/Keywords}
{Source}POV{/Source}
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