No Deal: Wiz Rejects Google, Sets Sights on IPO

Under the impetus of its cloud computing team, Google previously invested $23 billion to acquire the rapidly growing cloud cybersecurity company Wiz. This company primarily safeguards enterprise cloud infrastructure by creating a normative layer between cloud environments, nipping potential major security issues in the bud.

Despite being founded only four years ago, Google’s $23 billion offer underscores Wiz’s rapid growth. However, Wiz has now decided not to proceed with the acquisition by Google and will continue to operate independently. Wiz CEO, Assaf Rappaport sent an internal letter to the 1,200 employees, stating that while they were honored by the offer, the company chose to continue building Wiz, aiming for an annual recurring revenue (ARR) of $1 billion and preparing for an IPO.

Wiz’s current investors also support this decision, as Wiz’s scale is already substantial enough to pursue an IPO, making it unnecessary to sell to Google and become a subsidiary of Alphabet.

Another significant reason is that Wiz’s existing clients are distributed across various major cloud computing platforms, including Microsoft Azure, Amazon AWS, and Google Cloud. If Google were to acquire Wiz, it would inevitably trigger regulatory scrutiny to prevent potential monopoly issues.

Considering these factors, Wiz’s refusal to be acquired by Google is a very wise decision. For Wiz, going public should be relatively straightforward, and if Google is truly interested, it could indirectly strengthen its cooperation with Wiz by purchasing more shares post-IPO.

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