Alphabet buys Wiz

Alphabet is in advanced talks to buy cybersecurity startup Wiz for around $23 billion, which would be its largest acquisition ever. This acquisition comes amid intense antitrust scrutiny on Alphabet and aims to boost its cloud computing efforts, where it lags behind competitors.

Wiz, founded in 2020 by Assaf Rappaport and colleagues, has seen its valuation soar, raising $1 billion earlier this year at a $12 billion valuation. The company, which provides cloud cybersecurity software, hit $350 million in annual recurring revenue in 2023 and is backed by major VC firms like Sequoia Capital and Andreessen Horowitz.

If the deal goes through, it would provide a rare exit for investors in a tough IPO market. Wiz's founders previously sold their startup Adallom to Microsoft in 2015 for $320 million before launching Wiz.

Alphabet, valued at over $2 trillion, has been more conservative in acquisitions compared to its peer Microsoft. Notable past deals include Motorola Mobility for $12.5 billion in 2012, Fitbit for $2.1 billion in 2021, and Nest Labs for $3.2 billion in 2014. Alphabet has been expanding its cybersecurity business, including a $5.4 billion purchase of Mandiant two years ago.

In cloud computing, Alphabet is a distant third behind Amazon and Microsoft but is investing heavily, with cloud revenue growing 26% last year and the unit reporting its first operating profit.