Google Reportedly Pursuing $23 Billion Acquisition of Cloud Security Startup Wiz

Google parent Alphabet reportedly is moving closer to acquiring cloud security startup Wiz for about $23 billion.

The Wall Street Journal first reported the news, citing people familiar with the matter. This would be Alphabet’s largest acquisition to date.

Google completed its $5.4 billion acquisition of Mandiant in September 2022 and merged it with Google Cloud.

In May, Wiz announced it raised $1 billion during a new funding round, bringing its total funding to $1.9 billion. Wiz says it is now worth $12 billion.

Neither Google nor Wiz responded to our requests for comment.

Matthew Ball, chief analyst at Canalys, said this is would be a major statement by Google Cloud to become a cybersecurity platform competitor to the likes of Microsoft, Cisco, Palo Alto Networks and others.

“It already has security information and event management (SIEM) and security orchestration, automation and response (SOAR) capabilities through previous acquisitions that many GSIs and MSSPs are building a business around,” he said. “This deal would allow those partners to expand their offering further into cloud security. Increasingly, the leading platform vendors have SIEM/SOAR or a data lake capability. Wiz is one of the fastest-growing cloud security vendors, with an established customer base. The deal will help both Wiz and Google Cloud expand their reach.”

Related:Wiz Acquires Gem Security, Advancing CDR Capabilities

Canalys' Matthew Ball

The Mandiant deal was important for Google Cloud to gain thought leadership in cybersecurity and incident response capabilities, Ball said.

“The Wiz deal is just as important for Google Cloud to expand its cybersecurity technology stack,” he said. “But it will also increase competition with some of Google Cloud’s cybersecurity ISV technology partners that offer cloud security.”

Wiz a Major Player in Cloud Security

Rik Turner, senior principal analyst with Omdia, said if an acquisition does happen, it would be “an interesting one.” (Canalys and Omdia are both owned by Informa, Channel Futures' parent company.)

“Wiz is certainly a major player and I imagine the tech would continue to be offered to multicloud customers, rather than become Google Cloud Platform (GCP)-specific,” he said.

Omdia's Rik Turner

In April, Wiz acquired Gem Security, a cloud detection and response (CDR) provider. This was its second acquisition since its inception in 2020. Wiz plans to add to its cloud-native application protection platform (CNAPP) with Gem Security’s technology. The acquisition advances Wiz’s CDR capabilities.

For its first quarter of fiscal 2024, which ended March 31, Alphabet’s revenue rose 15% from the same time last year to more than $80.5 billion, which surpassed analysts’ expectations. Profit exceeded $23.6 billion, up from $15 billion for the year-ago quarter.

Related:Wiz Continues Big Growth with Another $1 Billion