Alphabet Inc., the parent company of Google, is in advanced discussions to acquire cybersecurity startup Wiz for approximately $30 billion. If finalized, this would mark the largest acquisition in Alphabet’s history, signaling its aggressive expansion in the cloud security sector.
A Renewed Bid for Wiz
Alphabet had previously attempted to acquire Wiz in 2024 for around $23 billion. However, negotiations collapsed due to concerns from some of Wiz’s directors and investors regarding potential antitrust scrutiny. The tech giant has now returned with a higher bid exceeding $30 billion, according to sources familiar with the matter.
While the discussions are ongoing, insiders suggest that an agreement could be reached soon. If completed, this deal would rank among the most significant mergers of the year. However, regulatory scrutiny remains a potential hurdle. The Federal Trade Commission (FTC), now under the leadership of Chair Andrew Ferguson in President Donald Trump’s administration, is expected to closely examine the deal. The administration has maintained strict antitrust policies, with Vice President JD Vance previously expressing concerns over the influence of Big Tech.
Alphabet and Wiz have not responded to requests for comment regarding the ongoing negotiations.
Wiz’s Rapid Growth and Market Position
Wiz, founded in 2020 by veterans of Israel’s elite cyber intelligence unit, has rapidly emerged as a dominant player in cloud security. The company, now based in the U.S., has witnessed exponential growth, benefiting from the increasing shift of businesses toward cloud-based operations.
By 2024, Wiz had reached $500 million in annual recurring revenue, a key performance metric for software startups. According to co-founder Roy Reznik, the company aims to double that figure by 2025. Wiz’s customer base includes nearly half of the top 100 largest American companies, reflecting its strong foothold in the cybersecurity industry.
A Challenging M&A Climate for Big Tech
This potential acquisition comes amid a challenging environment for large-scale mergers and acquisitions (M&A). Trade policy uncertainties and market volatility have dampened deal-making enthusiasm. Additionally, the Biden administration had imposed regulatory barriers on Big Tech before leaving office, and the new administration has continued to scrutinize major technology deals.
Despite these obstacles, Alphabet is determined to strengthen its cybersecurity offerings. The company previously acquired Mandiant for $5.4 billion in 2022 to bolster Google Cloud’s security capabilities. However, Google Cloud continues to lag behind competitors, holding approximately 12% of the global market share, compared to Microsoft Azure’s 21% and Amazon Web Services’ (AWS) dominant 33%.
Wiz’s Valuation and Investor Backing
Wiz last secured funding in 2022, raising $1 billion at a valuation of $12 billion. Its investors include prominent venture capital firms such as Andreessen Horowitz, Lightspeed Venture Partners, Thrive Capital, Index Ventures, Insight Partners, G Squared, Sequoia Capital, Greenoaks, Cyberstarts, and Wellington Management.
Following the collapse of last year’s acquisition talks with Alphabet, Wiz had indicated plans to go public via an initial public offering (IPO). However, the renewed bid from Alphabet suggests that the startup may opt for a direct sale instead.
Alphabet’s Strategic Move in Cloud Security
Alphabet’s interest in Wiz aligns with its broader strategy to enhance cloud computing security services. The company has been seeking ways to diversify its revenue streams and reduce reliance on its core advertising business. The addition of Wiz’s cutting-edge security solutions could significantly bolster Google Cloud’s ability to compete with AWS and Microsoft Azure.
If the deal is finalized, it would surpass Alphabet’s previous record acquisition of Motorola Mobility for $12.5 billion in 2011. While Alphabet later sold Motorola, its cybersecurity investments, including Mandiant and now potentially Wiz, indicate a long-term commitment to cloud security.
With negotiations ongoing, all eyes are on how regulatory authorities respond to this massive deal. If approved, Alphabet’s acquisition of Wiz could reshape the cybersecurity landscape and enhance its position in the competitive cloud computing market.
