Not selling for 167.5 billion yuan! This company refuses Google's sky high acquisition price
因醉鞭名马幌
发表于 2024-7-26 18:21:42
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Israeli cybersecurity company Wiz has rejected a $23 billion acquisition by Google's parent company Alphabet. The CEO of the company stated that they will choose to go public directly.
Why did the center refuse?
According to an internal email obtained by the media, Wiz CEO Assaf Rappaport stated that rejecting a quote at this level is difficult. But he pointed out that this move was the right choice, and he did not directly mention Alphabet in the email.
Rappaport added that the company will now focus on initiating initial plans for an IPO, with the goal of achieving $1 billion in annual recurring revenue. The data shows that the company's annual revenue in 2023 has reached 350 million US dollars.
A person close to Wiz company said that the company had weighed antitrust and investor concerns and ultimately decided to abandon the deal.
Just last week, the media reported that Alphabet is in deep negotiations to acquire Wiz for approximately $23 billion. If the transaction is completed, a valuation of $23 billion means Wiz's valuation has doubled in just two months, growing by over $10 billion.
Foreign media believe that, given the scrutiny surrounding mergers and acquisitions of large tech companies in recent years, board members of Wiz and Alphabet are concerned that this transaction may not pass the scrutiny of antitrust regulators.
In fact, last September, the US Department of Justice launched an antitrust lawsuit against Google in the field of Internet search. The US Department of Justice stated that Google pays over $10 billion annually to mobile phone manufacturers such as Apple and Samsung, telecom operators such as AT&T, and companies such as Firefox to maintain its position as the default search engine on web browsers and mobile devices, stifling market competition.
Difficulty in exiting startups
This year, whether it's IPOs or acquisitions, it's not common for American tech companies to exit, especially large tech companies. Start up companies not only need to face more stringent scrutiny from market investors before going public, but also face a more challenging acquisition regulatory environment.
Investors from other large investment institutions such as Lightspeed Venture Partners and Sequoia, which have raised billions of dollars in funding in recent years, are disappointed with the failure of this transaction.
PitchBook senior analyst Brendan Burke stated that multi billion dollar funds require over $10 billion in exit capital to generate substantial returns for their limited partners, and these events are rare.
Wiz is one of the few startups that can quickly obtain funding from investment institutions.
The founder of Wiz previously founded security startup Adallom and raised funds from large investment institutions such as Sequoia and Index. In 2015, the company was sold to Microsoft for $320 million. Former Sequoia Capital investor Doug Leone stated that this allowed Wiz to easily secure investment in its early days.
Wiz encountered an outbreak of COVID-19 shortly after its establishment in 2019. Large companies are rushing to adopt cloud based software and infrastructure to help employees work remotely. This transformation benefits Wiz as it can flag security issues for applications and data on Amazon, Google, Microsoft, and public clouds. Less than a year after its establishment, Wiz announced a $100 million funding round.
In May 2024, Wiz announced the completion of approximately $1 billion in financing, with a company valuation of $12 billion (currently approximately RMB 87.386 billion). Investment institutions include AH (Andreessen Horowitz), Lightspeed Venture Partners, Sequoia Capital, Thrive Capital, and others.
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声明：该文观点仅代表作者本人，本文不代表CandyLake.com立场，且不构成建议，请谨慎对待。
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