Google long-simmering interest in cloud security firm Wiz finally found its magic number – $32 billion – an amount that blew away many analysts and sets lofty expectations for Google’s artificial intelligence (AI)-focused multicloud cybersecurity future.

The all-cash transaction will see Google purchase New York-based Wiz, with plans for the deal to close at some point next year, at which point Wiz will join Google Cloud. Wiz, which was founded in 2020, is backed by venture capital firms including Sequoia Capital, Andreessen Horowitz, Index Ventures, and Lightspeed Venture Partners.

Wiz developed agentless security software that scans and analyzes containers and virtual machines in cloud environments, even if a resource isn’t online. It supports hybrid- and multicloud environments, allowing customers to connect to resources in public cloud environments – like Amazon Web Services (AWS), Microsoft Azure, and Google Cloud Platform (GCP) – as well as on-premises private clouds like OpenShift. Wiz also connects to managed container services and self-managed Kubernetes.

Google management repeatedly touted Wiz’s multicloud abilities as being key to the deal, including those abilities to tap the growing use of AI in the cybersecurity field.

“This is an innovative, leading cloud security platform trusted by more than 50% of Fortune 100 companies who already use their products and services,” Google CEO Sundar Pichai said during a briefing presentation on the deal. “It continues to deliver new products with strong adoption, defining entirely new categories of cybersecurity solutions and driving rapid business growth.”

Wiz CEO Assaf Rappaport added that the purchase “will enable us to execute and innovate even faster, enabling us to accelerate our rate of innovation faster than what we could achieve as a standalone company.”

Google Cloud CEO Thomas Kurian noted that’s similar to its acquisition and subsequent integration of Mandiant, Wiz will continue to support multicloud customers once the deal closes, specifically pointing to Wiz’s current work with Google Cloud rivals like AWS, Microsoft Azure, and Oracle.

“Google and Wiz are committed to continuing to support packaged applications, software-as-a-service, applications, and those running on virtual environments,” Kurian explained. “Google Cloud will continue to partner with other leading cloud security providers and independent software vendors to provide interoperability with our products, to provide them with new integration opportunities with our platform. And to make these partner solutions available to our customers via a Google Cloud Marketplace to offer customers greater choice, we will enable system integrators, resellers, and managed security service providers to offer broader solutions and services to our customers.”

Wiz cashes in

Analysts were blown away by the size of the deal.

Mauricio Sanchez, senior director for enterprise security and networking at Dell’Oro Group, in a blog post wrote that the purchase is “one of the most significant cybersecurity acquisitions ever,” towering over recent deals, including Thoma Bravo’s $12.3 billion purchase of Proofpoint, Broadcom’s $10.7 billion acquisition of Symantec, and Google’s own $5.4 billion purchase of Mandiant.

However, Sanchez also noted that Wiz has rapidly expanded its position as a leading cloud-native application protection platform provider (CNAPP). Dell’Oro Group defines CNAPP services as “a unified platform that combines software security, deployment security, and runtime security technologies to secure the entire lifecycle of cloud-native applications.”

“This platform approach fosters essential collaboration among development, security, and operations teams to protect applications and data throughout their deployment cycles effectively,” Sanchez further noted. “Wiz, an innovative pure-play vendor, exemplifies this integrated approach, rapidly capturing market share with near triple-digit revenue growth rates.”

Forrester VP and Principal Analyst Andras Cser added that the deal should further bolster Google Cloud’s position in the space and against rivals.

“While Google Cloud Platform has been investing in built-in CNAPP capabilities for their own platform’s native security with success, these tools have predominantly focused only on protecting GCP endpoints/assets,” Cser noted in a report. “After Microsoft’s 2021 early acquisition of CloudKnox and development of Defender for Cloud, Google is feeling the pressure to offer a true, multicloud-capable CNAPP tool given that so many organizations are multicloud today. Forrester expects that, post-acquisition, most current CNAPP capabilities in GCP (CSPM, CIEM, agentless CWP) will be replaced by Wiz’s offering and remain with multicloud support.”

Other vendors in this space include CrowdStrike, Palo Alto Networks, Zscaler, and Microsoft, as well as a handful of smaller vendors. Cser noted that those smaller vendors will “now face fierce competition from cloud infrastructure providers to stay ahead in features.”

Wiz’s unicorn journey

The deal completes what has been a Wiz operational whirlwind.

Wiz was formed by former Microsoft cloud and security executives in early 2020, and emerged from stealth later that with $100 million in Series A funding. It quickly added a $130 million Series B that pushed its valuation past “unicorn” status.

Wiz early last year was reportedly in talks to acquire Laceworks for around $200 million, which was just a fraction of Laceworks’ $8.3 billion valuation following its own Series D funding round in late 2021. However, that deal fell apart, and Lacework was subsequently acquired by Fortinet.

Wiz quickly recovered from that episode by raising $1 billion in new funding, which pushed its valuation to $12 billion. At that time, Wiz management claimed the vendor had achieved $350 million in annual recurring revenue (ARR) in 2023, serving more than 40% of the Fortune 100.

That funding round was quickly followed by reports that Google was interested in acquiring Wiz for $23 billion. However, Wiz’s management turned down the offer.

“While we are flattered by offers we have received, we have chosen to continue on our path to building Wiz,” Rappaport noted in a memo at that time. “Saying no to such humbling offers is tough, but with our exceptional team, I feel confident in making that choice.”

Google is now betting that its $32 billion offer will be the right choice.