In his memo to staff, Mr. Rappaport acknowledged the intense speculation surrounding a potential acquisition
Israeli cyber-security firm Wiz has turned down a $23 billion (£17.8 billion) acquisition offer from Google’s parent company, Alphabet. This rejection would have marked Alphabet’s largest-ever acquisition. In an internal memo to staff, Wiz founder and CEO Assaf Rappaport expressed appreciation for the offer, stating that the company aims to reach $1 billion (£775 million) in revenue before considering going public.
A source close to the negotiations revealed to the BBC that the offer was “very tempting.” However, Wiz believes it is capable of thriving independently and aims to become the leading cyber-security company globally. Earlier this year, Wiz reported an annual recurring revenue of $500 million (£387 million). The company also claimed to be the fastest-growing software company in history, achieving $100 million (£74 million) in annual revenue within its first 18 months.
In his memo to staff, Mr. Rappaport acknowledged the intense speculation surrounding a potential acquisition. He stated, “While we are flattered by offers we have received, we have chosen to continue on our path to building Wiz.”
Instead of selling, Wiz is planning an initial public offering (IPO), a significant step towards debuting on a stock exchange. This move marks the third venture by Mr. Rappaport and his co-founders Ami Luttwak, Roy Reznik, and Yinon Costic, who met while serving in the Israeli military. The team previously founded Adallom, a cyber-security company bought by Microsoft for $320 million (£248 million) in 2015. Following the acquisition, they worked at Microsoft on security products before leaving to launch Wiz in March 2020.
The founders’ experience at Microsoft has contributed to Alphabet’s interest in acquiring Wiz. In May, Wiz was valued at $12 billion (£9.3 billion) during a $1 billion (£775 million) fundraising campaign. London Stock Exchange head of tech Neil Shah commented on the founders’ decision, saying, “The founders of Wiz walk away from a billion $ payday and have put it back on the roulette table in the hope of a more rewarding outcome in the long term.”
Wiz, which operates bases in New York, Tel Aviv, and three other US locations, has yet to comment on the declined offer. Alphabet also has not issued a statement regarding the matter.
