Google won’t buy Wiz for $23 billion, security startup aims for IPO

The cybersecurity company, which was recently valued at $12 billion, will eventually pursue an IPO, CEO Assaf Rapaport said in a letter obtained by the company. Forbes.

Talks for Google to acquire cybersecurity unicorn Wiz have fallen apart, according to a letter sent by Wiz CEO Assaf Rapaport to company employees on Monday night.

“I know the last week has been stressful with rumors of a potential acquisition. We are grateful for the offer we received, but have chosen to continue on our path to building the Wiz,” Rapaport wrote in a letter to Wiz staff. Forbes.

Instead, Wiz will pursue a goal of $1 billion in annual recurring revenue ahead of an eventual IPO, explained the co-founders of the New York-based, Tel Aviv-founded cloud security provider.

Through a spokesman, Wiz declined to comment.

In a memo sent to about 1,200 Wizz employees around the world, according to a source familiar with the matter, Rapaport insisted it was Wizz’s decision, not Google’s, to walk away from the deal: “It’s tough to turn down such a tough offer, but we’re confident in our talented team in making that choice.”

Google did not immediately respond to a request for comment.

News of “advanced negotiations” between Google and Wizz was previously reported. The Wall Street Journal On July 14, the deal sparked frenzy of speculation that it could be the company’s largest acquisition ever.

Wiz recently announced in May that it had raised $1 billion at a $12 billion valuation, meaning the rumored sale price represents a 92% increase. Wiz’s notable investors include Cyberstarts, Index Ventures, Sequoia, GreenOaks Capital, Lightspeed Venture Partners, and more recently Andreessen Horowitz and Thrive Capital.

Founded in January 2020 by Rapaport and co-founders Ynon Kostica, Roy Resnick, and Ami Luttwak, Wizz quickly entered the cybersecurity industry with software that protects enterprise information in the cloud. Among the many security unicorns, Wizz stands out for its rapid revenue growth, voracious appetite for capital, and aggressive sales tactics. This cutthroat company-building approach has helped the company land at No. 15 on the Cloud 100 list. Forbes It will be featured in our May 2023 cover profile.

Wiz has been on an acquisitive spree of late: In April, the startup reportedly acquired another Israeli-founded security company, Gem Security, for $350 million, and then made a move to acquire Lacework, which was once valued at $8.3 billion, after receiving a reported offer of up to $200 million.

The company has a history of making bold market moves: In August 2023, Bloomberg reported that Wizz had approached banks about acquiring SentinelOne, a public company then valued at $4.9 billion. The talks resulted in SentinelOne CEO Tomer Weingarten later calling Wizz a “nice little startup.”