The parent company of tech giant Google, Alphabet Inc. is in the mature stage of talk to acquire cybersecurity startup Wiz for about $23 billion. The wall street Jounal has published the news first and stated that the deal was finalized which will be the company’s largest ever deal of acquisition.

The news was made public days after reports surfaced that Alphabet has decided not to pursue an acquisition of HubSpot, which is a company with a market capitalization of over $24 billion. Antitrust scrutiny was mentioned to have played a part in the company’s decision not to acquire HubSpot.

The startup posted that, annual recurring revenue of $350 million in 2023, up from $100 million in its first 18 months after its founding in 2020 by CEO Assaf Rappaport.

Reportedly the company has raised $1 billion earlier this year at a valuation of $12 billion, suggesting the takeover is nearly double from those levels. Wiz is backed by venture capitalists, including Sequoia Capital, Andreessen Horowitz, Index Ventures, and Lightspeed Venture Partners.

In 2024, Wiz was one of the few startups outside the AI sector to secure funding at a higher valuation. Many other startups are struggling due to the tech boom hangover caused by the previous low-interest rate environment.

If the deal goes through, it would be almost twice the size of Google’s largest acquisition to date, the $12.5 billion takeover of Motorola Mobility in 2012. In comparison, its second-largest acquisition was the $5.4 billion purchase of the security firm Mandiant.

According to the market analysis, for Google, this move would be a significant challenge to Microsoft and Amazon, as it represents a major bet on the cybersecurity space to complement its flagship GCP cloud offering.

This strategic decision would give Google an advantage in various cloud deployments and further monetize the cybersecurity cloud space, given that less than 50% of global workloads are currently on the cloud.