The largest-ever purchase of an Israeli-founded tech company was completed on Wednesday after multiple anti-trust regulators cleared the acquisition of cybersecurity unicorn Wiz by Alphabet’s Google for a staggering $32 billion.
The completion of the transaction is expected to funnel an estimated NIS 10 billion ($3.2 billion) into Israel’s state coffers in tax proceeds, as the four founders of Wiz and many of its employees are Israeli residents, and some of its investors are based in Israel. The tax revenue injection comes as Israel’s finances are being further strained by higher military spending needs amid the ongoing war with Iran.
The deal, first announced in March last year, amid Israel’s war with Hamas in Gaza, marks the largest purchase of an Israeli-founded company after US giant Intel Corp bought Mobileye, a Jerusalem-based developer of advanced vision and driver assistance systems, for $15.3 billion in 2017. For Google, it represents the largest acquisition the search giant has ever made, more than double its record purchase of Motorola Mobility for $12.5 billion in 2012.
“The finalization of Google’s acquisition of Wiz, roughly a year after it was first announced, sends a powerful signal about the strength and credibility of Israel’s technology ecosystem,” said Israel Innovation Authority CEO Dror Bin. “In a period when Israel has been facing complex security challenges, the completion of a deal of this scale reflects deep global confidence in the talent, resilience, and innovation that define Israeli tech.”
“It is a reminder that Israeli entrepreneurs continue to build companies that shape global industries, even in the most challenging times,” said Bin.
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As part of the deal, Wiz will join Google’s Cloud business, but remain independent. The firm, which says that its cyber platform is tailored to secure any application developers build and run in the cloud, employs about 1,800 workers, a workforce that will remain in place.
Wiz’s offices in Tel Aviv. (Courtesy)
“Keeping people safe online has always been part of Google’s mission,” said Google CEO Sundar Pichai. “This job is increasingly important today, as more companies and governments move their work to the cloud and broadly use generative AI.”
“By bringing Wiz and Google Cloud together, we’re making it easier for organizations to innovate with confidence,” said Pichai.
The deal is expected to boost Google’s cloud security offerings to help it compete with rival tech giants Amazon and Microsoft, and other big cyber firms such as Palo Alto Networks and CrowdStrike.
With the acquisition, Google seeks to build an AI-powered cybersecurity platform that combines its threat intelligence and security operations with Wiz’s cloud and AI security platform.
“Our mission remains bold and unwavering: to help every organization protect everything they build and run,” said Wiz co-founder Assaf Rappaport. “What has changed is the world around us. Now, we must do this at the speed of AI.”
Wiz was founded in early 2020 just as the COVID-19 pandemic started gaining pace around the world, sending entire enterprises and workers online and spurring a huge migration wave to cloud-based servers, which in turn exposed businesses and organizations to heightened network security risks.
ILLUSTRATIVE- Cybersecurity. (NicoElNino via iStock)
Wiz’s four founders – Rappaport, 40, Costica, 41, Ami Luttwak, 40, and Roy Reznik, 35 – met in the Israeli army and served together in the IDF for almost a decade. They were graduates of the famed elite Israeli military intelligence unit 8200, which has built a track record of churning out serial tech entrepreneurs and founders of startups, including Nice, Palo Alto Networks, CyberArk and Waze.
“Wiz was born into a global pandemic and then a long war at home,” said Wiz co-founder Costica in a LinkedIn post. “Throughout these periods, Wiz has been a beacon, that tells a different story about Israel – a story of world-class talent, relentless creativity and a thriving global tech ecosystem.
The four Wiz founders in 2012 built their first startup, Tel Aviv-based cloud security firm Adallom, which they sold three years later to Microsoft for $320 million.
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