Image source, Getty Images
- author, Joe Tiddy
- role, Cyber Correspondent, BBC World Service
Israeli cybersecurity firm Wizz has rejected a $23bn (£17.8bn) takeover bid from Google’s parent company Alphabet that would have been the company’s biggest acquisition ever.
In an internal memo to employees seen by the BBC, Wizz founder and chief executive Assaf Rapaport said he was “honoured” by the offer.
He said the company aims to achieve sales of $1 billion (£775 million) before offering its shares to the public.
A source close to the deal told the BBC that the offer was “very attractive” but that Wizz believed it was large enough to attempt to become the world’s largest cybersecurity company on its own.
Earlier this year the company reported annual recurring revenue of $500 million (£387 million).
Wiz and Alphabet have been contacted for comment.
“I know the past week has been a tense one given the commotion surrounding a potential acquisition,” Rapaport said in a memo to employees.
“We are honored by the offer we received, but have chosen to continue on our path to building Wiz.”
After rejecting Google’s offer, Wizz will pursue an initial public offering (IPO), a major step towards the company listing on the stock market.
From the military to Microsoft
Wiz is the third venture from Rapaport and his three co-founders, Ami Luttwak, Roy Resnick and Ynon Kostic, who first met while serving in the Israeli military.
The group worked alongside agencies in the UK that were equivalent to the UK’s Government Communications Headquarters (GCHQ) and the US National Security Agency.
Many of the world’s largest Israeli cybersecurity companies, including Check Point, Palo Alto and Armis, were founded by people who worked in the sector.
In 2012, the founders founded a cybersecurity company called Adalom, which was acquired by Microsoft for $320m (£248m) three years later.
As part of the deal, the founders brought their team to the tech giant to work on developing security products.
They left Microsoft and launched Wiz in March 2020.
Image source, Getty Images/Bloomberg
Critics say the reason there was so much excitement within Alphabet about a potential acquisition of Wizz was because of its founders’ work at Microsoft.
In May, it was valued at $12 billion (£9.3 billion) after a $1 billion (£775 million) fundraising campaign.
“This is the kind of thinking Europe needs,” Neil Shah, head of technology at the London Stock Exchange, said in a LinkedIn post.
“The founders of Wiz gave up $1 billion in compensation and put the money back on the roulette table in the hopes of a more profitable outcome in the long run.”
“They saw where the value went the last time they sold. We wish them the best of luck.”
According to the company’s website, Wiz has offices in New York, Tel Aviv and three other locations across the US.
