Google's parent company Alphabet is in advanced talks to acquire Wiz for $23 billion, a person close to the company told TechCrunch. The deal talks were previously reported by The Wall Street Journal.
According to sources, Wiz, a cybersecurity startup founded in 2020, was approached by Google's cloud chief Thomas Kurian a few weeks ago. Negotiations have progressed rapidly since then, and the two sides have tentatively agreed on an acquisition price.
The person said there are many hurdles and details that need to be worked out in a deal of this magnitude, but declined to say what those hurdles are. The source said deal negotiations could take another week to 10 days and there is a 50 percent chance they will fall apart.
The offered price is more than double Wizz's previous private valuation of $12 billion, when it raised $1 billion in Series E in May.
Wiz has been growing at an incredible rate. Just 18 months after launch, the company hit $100 million in ARR (annual recurring revenue), making it one of the fastest-growing companies of all time. In May, Wiz announced that its ARR was in the $350 million range. Since then, the company's growth has only accelerated. It now has $500 million in ARR and is on track to hit $1 billion in ARR next year, people familiar with the matter said.
Wiz had always been looking to go public due to its rapid growth, but it didn't plan to do so this year or in 2025. The company hadn't been looking for a buyer before it was approached by Google.
But Google Cloud could provide Wiz with strong revenue synergies, meaning more opportunities for the company to sell its products to the tech giant's customers.
If the acquisition goes through for $23 billion, it would value Wiz at 46x its current ARR and 23x its projected ARR for 2025. By comparison, Wiz's main competitor, Palo Alto Networks, trades at just over 14x trailing 12-month revenue. Google appears willing to pay a nearly 300% premium for Wiz's closest competitor.
Wiz's backers include Andreessen Horowitz, Cyberstarts, Index Ventures, Insight Partners and Sequoia.