Reasons Google Acquired Wiz

You know what’s cooler than getting acquired for $23B? Walking away from the deal, waiting nine months, and then getting acquired for $32B—with a $3.2B termination fee if the deal doesn’t go through. That’s the story of Wiz and Google. I have to hand it to Google for its patience and persistence in making this happen. But we’re just getting started. I’ve been on my phone all day, fielding questions from customers who are trying to make sense of this deal. A lot of folks, including a number of reporters I talked to, are also wondering: What will Google do with Wiz? And why did they pay so much? That’s an easy answer. Google Cloud has already made significant investments in cybersecurity—SecOps through Chronicle, threat detection and incident response through Mandiant, and a thriving third-party marketplace with partners such as Palo Alto Networks. This move shouldn’t come as a surprise. Google has been working toward a unified cloud security and TIDR (threat intelligence, detection, and response) platform that runs on a single "security fabric." Wiz’s CNAPP platform and security graph will be critical in making cloud security a first-class citizen. As SoC automation accelerates, customers are looking for a modern CDR (continuous detection and response) solution—one that goes beyond traditional EDR/XDR or SIEM/SOAR models. They want a cloud-first approach to power their SoC, and that’s what’s driving the frenzy. And let’s not forget the bigger picture: Every dollar spent on cybersecurity, just like AI and analytics, translates into even larger spend on cloud services. Google would prefer that spending to happen on Google Cloud—not Azure or AWS. And that’s the concern shared by many people I spoke to. While Wiz has been a key Google Cloud partner, a significant portion of its customers are on Azure and AWS. Google’s experience with multi-cloud offerings through previous acquisitions, such as Looker, will be beneficial. Nevertheless, delivering cloud-native security solutions on cloud platforms outside its direct control introduces an entirely new set of complexities. Google's ability to navigate these challenges—while retaining Wiz’s existing Azure and AWS customers—will be crucial to making this acquisition successful in the long term. So far, Google has managed to maintain trust with their security ISV partners despite sizeably growing its first-party security portfolio. The ecosystem is thriving. But the big question partners I spoke to are asking: Is this a one-off acquisition, or the start of Google’s push to go all-in on security and build a security empire? It’ll be a while before this deal closes, and I’ll be watching closely. I’m also advising our CxO clients to do the same. Next month, I’ll be at Google Cloud Next and RSAC, digging into this with Google, customers, and partners. And people think cybersecurity is boring. Yes, it's $32B boring.

I've been thinking about the WHY behind the Google and Wiz marriage, and my key takeaway is... Google just bought its way into owning the core foundation (cybersecurity-focused data fabric) of a unified security system for all code and cloud. Wiz created the ultimate graph-based cyber approach that works well with an AI overlay. Wiz will become the bedrock of all Google cyber offerings in the future. Expect Google to become a dominant player in the platformization race for global cyber dominance. All of you marginalized security markets out there - try not to celebrate too hard. I don't think that Google is where good companies go to die. This isn't the old days where acquisition meant death. I expect Google to leverage this acquisition into a top-three cyber position over time, competing specifically against a selection of PANW, CRWD, MSFT, ZS, and Amazon.

A different perspective on the Wiz / Google discussion: 🔥 Data 👇 Wiz has a obviously developed a killer product and GTM motion. But what Google would also acquire is a data asset that can be monetized many times over. Three scenarios, in order of "closeness to revenue": 1. Data for analytics 2. Data for AI 3. Data for a graph DB 𝗔𝗻𝗮𝗹𝘆𝘁𝗶𝗰𝘀 Add capabilities that Wiz doesn't have. Timeline view of my inventory, custom reporting on SLAs, SQL-based analytics, long-term storage of security data, security lake. Would differentiate Wiz even more. GCP has the best analytics portfolio among the clouds bar none. BigLake, BigQuery, Cloud Composer, Looker Studio, to name just a few examples. Send Wiz data into that stack, and that data gets monetized many times over, for compute (transform data, run queries), storage (a growing pile of security data) and seats (looking at dashboards). Data has gravity - if you bring data into GCP, the workloads will follow. Net new $$$ for GCP. 𝗗𝗮𝘁𝗮 𝗳𝗼𝗿 𝗔𝗜 The security data Wiz collects becomes training data for AI - it's an asset that GCP simply doesn't have right now, and wouldn't for a long time. But GCP certainly has the GPUs to train the models. Combine the two, and we're looking at AI-supported use cases for threat and anomaly detection - which would be a differentiating feature for the core product offering. Hell, GCP even offers cyber insurance in collaboration with Allianz & MunichRE, using Wiz data for better insurance risk assessments. 𝗗𝗮𝘁𝗮 𝗳𝗼𝗿 𝗮 𝗴𝗿𝗮𝗽𝗵 𝗗𝗕 Wiz runs mostly on AWS, specifically Neptune, the AWS graph database. Neptune is the technology secret sauce behind Wiz' security graph. The graph is the reason why they can do what no one else can do (actually, we can, but that's another conversation). Graph DBs are not a big market segment, relational DBs probably dwarf it by 100x. However, it's a fast-growing segment, and in a world of AI, they're kind of a must-have these days. GCP does not have a graph database. Instead, they're offering a Google Cloud-ready version of Neo4j. Rumor has it that GCP is developing their own graph DB - acquiring Wiz could be a catalyst for that new graphDB. Obviously, replacing the core production database for Wiz is not an immediate priority. Kind of the last thing you want to do actually. But: • the defensive scenario for building a graph DB is to take the workloads away from AWS. • the offensive scenario is to build an integrated security analytics product that's built on a GCP-developed graphDB. And so I think there's much more to buying Wiz than buying a CNAPP that GCP will offer as part of their portfolio. IMHO, the current product-centric conversation of a potential acquisition  misses these data-related aspects.  

☁️ 𝗚𝗼𝗼𝗴𝗹𝗲 𝗷𝘂𝘀𝘁 𝗺𝗮𝗱𝗲 𝗶𝘁𝘀 𝗯𝗶𝗴𝗴𝗲𝘀𝘁 𝗮𝗰𝗾𝘂𝗶𝘀𝗶𝘁𝗶𝗼𝗻 𝗲𝘃𝗲𝗿. A $𝟯𝟮 𝗯𝗶𝗹𝗹𝗶𝗼𝗻 𝗱𝗲𝗮𝗹 to buy 𝗰𝗹𝗼𝘂𝗱 𝘀𝗲𝗰𝘂𝗿𝗶𝘁𝘆 𝘀𝘁𝗮𝗿𝘁𝘂𝗽 𝗪𝗶𝘇. The purchase eclipses the $12.5 billion Motorola Mobility deal and nearly equals what it spent on its top 10 acquisitions combined. 1. 𝗪𝗶𝘇 (expected in 2026): $32 billion 2. 𝗠𝗼𝘁𝗼𝗿𝗼𝗹𝗮 𝗠𝗼𝗯𝗶𝗹𝗶𝘁𝘆 (2012): $12.5 billion 3. 𝗠𝗮𝗻𝗱𝗶𝗮𝗻𝘁 (2022): $5.4 billion 4. 𝗡𝗲𝘀𝘁 𝗟𝗮𝗯𝘀 (2014): $3.2 billion 5. 𝗗𝗼𝘂𝗯𝗹𝗲𝗖𝗹𝗶𝗰𝗸 (2007): $3.1 billion 6. 𝗟𝗼𝗼𝗸𝗲𝗿 (2020): $2.6 billion 7. 𝗙𝗶𝘁𝗯𝗶𝘁 (2021): $2.1 billion 8. 𝗬𝗼𝘂𝗧𝘂𝗯𝗲 (2006): $1.7 billion 9. 𝗪𝗮𝘇𝗲 (2013): $1.2 billion 10. 𝗛𝗧𝗖 𝘀𝗺𝗮𝗿𝘁𝗽𝗵𝗼𝗻𝗲 𝘂𝗻𝗶𝘁 (2018): $1.1 billion 𝗔 𝗦𝗲𝗰𝗼𝗻𝗱 𝗖𝗵𝗮𝗻𝗰𝗲 Last year, 𝗪𝗶𝘇 𝗿𝗲𝗷𝗲𝗰𝘁𝗲𝗱 𝗚𝗼𝗼𝗴𝗹𝗲’𝘀 $𝟮𝟯 𝗯𝗶𝗹𝗹𝗶𝗼𝗻 𝗼𝗳𝗳𝗲𝗿, betting it could thrive independently or go public. But Google stayed persistent, keeping lines open with Wiz’s leadership while competition for the company grew. When Google came back to the table, Wiz had seen its annual recurring revenue jump from $𝟱𝟬𝟬 𝗺𝗶𝗹𝗹𝗶𝗼𝗻 to over $𝟳𝟬𝟬 𝗺𝗶𝗹𝗹𝗶𝗼𝗻, and the cloud security market had become even more critical. This time, the deal moved quickly—with Google outbidding rival suitors and reportedly offering a $𝟯.𝟮 𝗯𝗶𝗹𝗹𝗶𝗼𝗻 𝗯𝗿𝗲𝗮𝗸𝘂𝗽 𝗳𝗲𝗲 Google would pay to Wiz if the deal collapses. 𝗪𝗵𝘆 𝗪𝗶𝘇? 𝗧𝗵𝗲 𝗖𝗹𝗼𝘂𝗱 𝗦𝗲𝗰𝘂𝗿𝗶𝘁𝘆 𝗥𝗮𝗰𝗲 Founded in 2020, Wiz skyrocketed to become a dominant cybersecurity player, with over 45% of Fortune 100 companies relying on its tools. As businesses increasingly operate across multiple cloud platforms, security is a growing concern. Wiz specializes in cloud-native cybersecurity, allowing companies to detect and respond to threats across Google Cloud, AWS, and Microsoft Azure. By acquiring Wiz, Google isn’t just enhancing its security capabilities—it’s making a play for large enterprise customers that use multiple cloud providers. Additionally, Wiz’s expertise complements Mandiant, the cybersecurity firm Google bought in 2022 for $5.4 billion. Together, they bolster Google’s position as a serious competitor to Microsoft, which dominates cloud security with $20 billion+ in annual revenue. 𝗪𝗵𝗮𝘁’𝘀 𝗡𝗲𝘅𝘁? The deal faces regulatory scrutiny, especially with Google already under pressure from antitrust investigations. With a significant breakup fee, Google is showing confidence that it can clear the hurdles. If successful, this move could reshape Google Cloud’s security offerings, boosting its position as AI-driven cloud computing takes center stage. 𝗜𝗳 𝘆𝗼𝘂 𝗹𝗶𝗸𝗲 𝘁𝗵𝗶𝘀, 𝘆𝗼𝘂'𝗹𝗹 𝗹𝗼𝘃𝗲 𝗼𝘂𝗿 𝗻𝗲𝘄𝘀𝗹𝗲𝘁𝘁𝗲𝗿! 𝗛𝘂𝗻𝗱𝗿𝗲𝗱𝘀 𝗼𝗳 𝘃𝗶𝘀𝘂𝗮𝗹𝘀 𝗲𝘃𝗲𝗿𝘆 𝗲𝗮𝗿𝗻𝗶𝗻𝗴𝘀 𝘀𝗲𝗮𝘀𝗼𝗻. 𝗝𝗼𝗶𝗻 𝟮𝟬𝟬,𝟬𝟬𝟬+ 𝘀𝘂𝗯𝘀𝗰𝗿𝗶𝗯𝗲𝗿𝘀. Check out our coverage of Alphabet's latest quarter. 👇 https://lnkd.in/g52r7C3h