Cloud security unicorn Wiz is reportedly in advanced negotiations to acquire its rival Lacework for $150-$200 million, a fraction of its previous valuation of $8.3 billion after its Series D funding round in November 2021.

“Wiz has experienced unprecedented organic growth since its inception, and we are dedicated to pushing this growth even further. Simultaneously, we recognize that consolidation is the future of the security industry and therefore are actively engaged in discussions with companies across the industry,” the Wiz team wrote in an official comment sent to SDxCentral.

“We are always exploring compelling M&A opportunities that will enhance both our technological capabilities and business expansion, as we strive to build the world’s leading cloud security platform,” according to the team.

Earlier this month, Wiz completed the acquisition of cloud detection and response specialist startup Gem Security for about $350 million. This is Wiz’s second buy after its December 2023 acquisition of Raftt, a developer collaboration platform.

Wiz has been on a torrid growth trajectory since its inception four years ago, recently reaching $350 million in annual recurring revenue (ARR) and counting over 40% of Fortune 100 companies as customers.

The cloud security company has raised $900 million over five rounds including a $300 million Series D round led by Greenoaks, Index Ventures and Lightspeed Venture Partners. Cyberstarts and Blackstone Group are its most recent investors.

In February, Wiz snagged former Zscaler president and chief operating officer Dali Rajic to lead its growth strategy and operational scaling as it targets $1 billion in ARR and a future initial public offering (IPO).

The startup also plans to expand its headcount and add to its current base of over 900 employees across the United States, Europe, Asia-Pacific and Israel.

Lacework was last valued at $8.3B

Founded in 2015, Lacework developed a cloud security platform that provides several capabilities including cloud security posture management (CSPM), vulnerability scanning, cloud-workload protection, threat detection and response, runtime and build-time threat defense, and identity and access management across Amazon Web Services (AWS), Microsoft Azure, Google Cloud, and Kubernetes- and container-based environments.

The startup has raised over $1.9 billion in funding since its 2015 founding from top venture capital firms like Altimeter Capital and Google Ventures. Its latest funding was raised in Feb 2022 from a Venture - Series Unknown round led by Google Ventures.

Lacework banked $1.3 billion in its Series D round in November 2021 led by Altimeter Capital, which pushed its value to $8.3 billion. However, the company announced cutting 20% of its workforce just 6 months after it closed this funding round.

Lacework is estimated to have around 600 customers and $100 million in ARR, according to recent reports.