Wiz’s decision to walk away from a potential $23 billion acquisition by Google is expected to have significant implications for the tech industry, particularly for Microsoft.
The Israeli cybersecurity startup’s CEO, Assaf Rappaport, stated that the company made the difficult choice to decline Google’s offer to focus on its goal of achieving $1 billion in annual revenue and preparing for an initial public offering (IPO). This acquisition would have enhanced Google’s cybersecurity capabilities, which are increasingly crucial following a recent major outage affecting the industry, linked to CrowdStrike.
Wedbush analyst Dan Ives noted in a research report that concerns from investors and existing antitrust issues surrounding Google contributed to the deal’s collapse. Google has faced heightened scrutiny from regulators and has recently concluded a trial involving antitrust challenges from the Department of Justice.
Ives mentioned that the failure of this deal could have ripple effects throughout the sector, indicating that Google would likely continue to strengthen its cybersecurity efforts regardless. He also suggested that Microsoft might pursue acquisitions to bolster its own cybersecurity platform over the next year to 18 months.
Microsoft’s position was further highlighted after a widespread IT outage caused by an erroneous software update from CrowdStrike affected numerous users globally, leading to disruptions in businesses, flights, and governmental operations. While Ives describes CrowdStrike as a leading entity in the cybersecurity realm, the incident underscores the need for Microsoft to enhance its cybersecurity offerings now that Google’s acquisition plans have fallen through.