Google parent Alphabet is in the final stages of negotiations to buy cloud cybersecurity startup Wiz for a record $23 billion, the WSJ reports. If the deal doesn’t fall through, the acquisition could be Alphabet’s largest in history since it bought Motorola Mobility for $12.5 billion in 2012.
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Based in New York and founded in 2020 by CEO Assaf Rappaport and his associates, Wiz has achieved impressive results in a short time. The company raised $1 billion in funding earlier this year at a $12 billion market cap and is one of the few startups outside of the AI industry to achieve a 2024 valuation.
Wiz’s success is especially noteworthy amid a general downturn in the startup market, which is still reeling from the tech boom of the early part of the decade. The company said it achieved $100 million in annual recurring revenue after just 18 months of operations, with that figure rising to $350 million in 2023.
Google’s (Alphabet) interest in Wiz comes amid increased antitrust scrutiny of the search giant and other tech companies. In particular, Google has already faced lawsuits from the US Department of Justice on charges of violating antitrust laws in the field of Internet search and advertising technologies. The acquisition could also help bolster Alphabet’s position in cloud computing, an increasingly important and fast-growing business area in which the company currently trails its competitors. Despite the rapid growth of this business area (Google grew 26% last year), the company still lags significantly behind market leaders and ranks third behind Amazon and Microsoft.
If the deal is successful, it will be one of the largest in the technology sector in recent memory, especially given the general slowdown in mergers and acquisitions (M&A) due to antitrust risks and high interest rates. Interestingly, earlier this year, American multinational Cisco completed its $28 billion takeover of software developer Splunk, which also focuses on troubleshooting IT infrastructure, again confirming the growing interest in IT security among large companies .