Wiz to Google: "F*ck You! We're No CrowdStrike!" to $23 Billion Offer
Attention startup founders: This is a masterclass in high-stakes negotiations and strategic bluffing. You won't find this in your MBA syllabus or CFA curriculum.
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A major story that slipped under the radar yesterday was the negotiation clinic put on by Wiz, a unicorn cybersecurity startup, against Google. Harvard Business School should take note for a future case study.
Why? Because it’s either one of the boldest bluffs in negotiation history, or Wiz has some unique, game-changing secret known only to its founders.
So, what happened?
Wiz, an Israeli cybersecurity company specializing in cloud security solutions, was offered $23 billion by Google. This offer was almost twice Wiz’s valuation of $12 billion from just two months ago. It suggested a revenue multiple of 66 based on the company’s 2023 annual recurring revenue (ARR), making it one of the most overvalued acquisitions in history. (Sources: Bloomberg, Forbes Israel.)
Wiz said no. What?
I’m speechless! I don’t see this every day.
I wish I was a fly on the wall in that boardroom. I wasn’t. So, based on the facts I know, here are the 8 reasons Wiz’s founders gave to Google for rejecting the $23 billion offer. Remember, most of what Wiz was saying wasn’t necessarily aimed at Google. It was directed at the market and the investment bankers, gearing up for its upcoming IPO.
