Startup News: Wiz will pursue IPO after turning down takeover by Google
Last week it appeared that cybersecurity startup Wiz was about to be taken over by Alphabet’s Google for $23 billion. But in an about-face, Wiz has decided instead to pursue previous plans to go public.
On Monday, Wiz Co-Founder Assaf Rappaport told his employees in a memo reviewed by The New York Times that a deal to be acquired was off, adding that the company was focused on staging an IPO on a U.S. stock exchange.
Rappaport said that the company is intent on achieving its goal of generating $1 billion in annual recurring revenue as a prelude to going public sometime in the future. According to The Times, the company reached $350 million in annual recurring revenue in 2023.
“While we are flattered by offers we have received, we have chosen to continue on our path to building Wiz,” Rappaport wrote in the memo published by The Times.
According to CNBC, an unnamed source close to Wiz’s leadership said that the company abandoned the merger with Google in part because of concern that the U.S. government would fight the deal on antitrust grounds. The Times wrote that Google has faced plenty of resistance from the U.S. Department of Justice which has sued the Alphabet division in two separate cases.
“One [case] is targeting [Google’s] ubiquitous search engine and another is seeking to break up its digital advertising-technology business,” The Times wrote.
Founded in 2020, New York City-based Wiz is a cloud security company that seeks to provide security solutions for customers in many industries. The company was valued at over $12 billion in May 2024, based on the latest funding round data available on Forge Global. Thus, Google’s acquisition would have nearly doubled Wiz’s value.
CNBC writes that Wiz’s portfolio of cloud security products would have helped Google’s cloud business take on major competitors such as Microsoft and Amazon. Wiz’s customers include companies such as BMW, Colgate-Palmolive, Snowflake, and IHG Hotels & Resorts, according to its website.
Wiz’s Forge Price™ is $21.52 as of July 23, 2024.
