Wiz, the buzzy startup building an end-to-end cloud security platform, is on an acquisition spree to rapidly expand its business on its way to going public.
Now, it has closed a major $1 billion round of funding to help along the way.
The Series E — co-led by Andreessen Horowitz, Lightspeed Venture Partners and Thrive — values Wiz at $12 billion, making it one of the most valuable cybersecurity startups today.
It's a notable step up from the last time Wiz raised, in February 2023, when it closed a $300 million round at $10.3 billion after funds. When rumors of this latest fundraising hit the market in March, the amount was pegged at $800 million. The fact that the Series E is now at $1 billion speaks to how hot the activity is around Wiz right now. “Iconic” was the word one investor, speaking to TechCrunch, used to describe the company.
(The company has confirmed that the Series E also has a small secondary component. Sources close to the deal say the price ranges from $30 million to $40 million, “a few tens of millions of dollars.”)
Assaf Rappaport, co-founder and CEO of Wiz, said in an interview that Wiz plans to continue developing its platform organically by hiring more talent and investing in research and development. But with countless cybersecurity startups now, the New York startup sees a huge opportunity to capture growth inorganically through acquisitions, bringing customers, talent and technology into the fold more quickly.
“We see two types of opportunities in the market right now,” he said. “There are early startups” — startups that have raised big money at valuations exceeding $1 billion, but may have failed to grow as expected and are now exploring options beyond an IPO — “and also exciting, younger startups and superstars with a great trajectory” ahead of them. We have an opportunity now to join forces with both.
The large size of this round gives Wiz plenty of room to make acquisitions for cash, meaning giving up less equity in Wiz itself – a sign of the company's intentions to go public in the future.
The fundraising comes at a time when Wiz is already rounding up small businesses. It acquired Gem Security just a month ago — which Rappaport described today as falling into the latter, “exciting, younger” category — for $350 million. Just weeks later, Wiz signed a letter of intent to buy Lacework, the startup once valued at $8.3 billion, for just $168 million. (This would make it a “unicorn precedent” in Rappaport's terminology.) The latest deal has gone cold, and we now understand, while doing our due diligence, that it is a reminder that simply having the interest and money to buy in is not enough to get deals on a larger scale. Line.
The company has a long list of companies that you can choose from. According to one estimate, there are 62 cybersecurity startups with recent valuations of more than $1 billion right now. The list includes Aqua and Orca – which are not related to each other but are partners – as well as Netskope, Snyk, Arctic Wolf, Axonius and many more. The smaller ones number in the hundreds. All of these compete against much larger players in the market including Palo Alto Networks, Crowd Strike, and more.
Wiz was founded just four years ago by Rappaport and his co-founders Ami Luttwak, Yinon Costica, and Roy Reznik (all of whom were previously at Microsoft, and have experience building startups and exiting success in the past). The company claims to have signed contracts with about 40% of the Fortune 100, with some of its largest clients including BMW, Colgate-Palmolive, and strategic investor Salesforce and Mars.
Together, this business now reaches $350 million. This is still a far cry from the $1 billion ARR it aims to achieve by the end of 2025. However, this target is another reason the company is looking to grow through acquisition.
Wiz's success in the market is partly because of the area it targets, and partly because of its approach.
Organizations have made significant investments in cloud services to accelerate the way they work and to make their IT more agile, but this shift has come with a dramatically changed security profile for those organizations: network and data structures are becoming more complex, and attack surfaces are larger, creating opportunities for malicious hackers to find ways to… To hack those systems.
Wiz has stood out in a crowded market by taking an all-in-one platform approach. By ingesting data from AWS, Azure, Google Cloud, and other cloud environments, Wiz scans applications, data, and network operations for security risk factors and provides a set of detailed views to its users to understand where those risks exist, as well as how to fix them. Its platform currently covers about 13 areas, ranging from code security, container environment security, and supply chain security, and around that it integrates and partners with a number of other startups to build its ecosystem (and customer adaptability).
Philip Clark, who leads investment at Thrive Capital, described AI as part of the “next wave of security issues,” and Wiz has also expanded its activity there, specifically in managing the security posture of AI.
“It meets customers where their needs are,” Sarah Wang, general partner at a16z, told TechCrunch. “There is nothing that directly competes with Wiz in cloud security.”
Meanwhile, opportunities abound. When I spoke to Rappaport on Monday for this story, he had just arrived in San Francisco for the RSA Security Conference, where there will be nearly 600 companies exhibiting: a good opportunity to do some shopping.
The funding – which also saw participation from Greylock and Wellington Management, as well as previous backers Cyberstarts, Greenoaks, Howard Schultz, Index Ventures, Salesforce Ventures and Sequoia Capital – brings the total amount raised by Wiz to $1.9 billion.
This long list of big-name backers, added to the list that Rappaport said he rejected, underscores investor interest in the company right now.
“Wiz is nothing less than a rocket ship,” another investor, Arsham Memarzadeh of Lightspeed, said in a statement.
