Why Wiz Walked Away: Inside the Billion-Dollar Acquisition Drama

Name: Why Wiz Walked Away: Inside the Billion-Dollar Acquisition Drama
Uploaded: 2024-08-10T10:04:26+00:00
Duration: 55 s
Channel: Jason M. Lemkin
Description: In this commentary, Jason M. Lemkin analyzes the reported collapse of a multi‑billion‑dollar acquisition attempt involving cloud‑security startup Wiz. He…

10 Aug 2024 · 1 min

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In this commentary, Jason M. Lemkin analyzes the reported collapse of a multi‑billion‑dollar acquisition attempt involving cloud‑security startup Wiz. He outlines a rapid negotiation timeline: an initial $10 billion overture (likely from Thomas Coriam), a swift escalation to roughly double the last financing round, and a final offer in the $22‑$23 billion range that was presented before any formal meeting. Lemkin notes that the entire back‑and‑forth unfolded within about 48 hours, and a final decision was made within a week and a half. He argues that Wiz’s founders, already eyeing an IPO after achieving eight‑figure revenues, deemed the acquisition risk‑laden and opted for a quick “no,” preferring the certainty of a public market exit over a massive but uncertain buyout.

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So do you believe that Wiz walked away because they did not think that it would go through? Because they felt— that's the number one. I think the offer was real, like in the press. I think Thomas Coriam called them up. I think they had a quick— he probably offered $10 billion. There was a quick back and forth and it quickly became 2x the last round. Right. I mean, literally when I sold my first startup, the acquirer went, got our certificate of incorporation in Delaware and offered us 3x last round before we even met. He's like, this is the clearing price, 3x your last round. So they offered it before the first meeting. Okay. So that took like 48 hours because you have to offer less or you look like He's, he's not the CEO of Google, he's just running Google Cloud. They offer $22 billion, $23 billion, and it's interesting, they talk about it with the team, and then this was over in a week and a half, I think, because it, it wasn't worth the risk. I don't think it was worth the risk. I don't think it was worth the risk, not for founders that are already wanted to go IPO with the growth they've had, and guys that have already made 8 figures. It wasn't worth the risk. I think it was a quick no. I think it was actually a quick no is what I think happened.