[ad_1]
Wizone of the most talked about names in the world of cybersecurity, is making a major acquisition to expand its product range in the cloud security space, especially with developers. It’s a buy dazzlespecializes in security processing and risk management. Sources tell us the deal is worth $450 million in a mix of cash and stock.
This marks a bump in the startup’s latest funding round. In July, we reported that Dazz had raised $50 million at a post-cash valuation of just under $400 million.
Remediation and situation management – the two areas that Dazz focuses on – are key services in the cybersecurity market that Wiz was not covering as well as it wanted to.
“Dazz is the leader in this market, has the best talent, the best customers, and a great culture fit,” Wiz CEO Assaf Rappaport said in an interview.
Remedy, which refers to helping understand and resolve vulnerabilities, gives shape to how an organization actually handles many of the vulnerability alerts it may receive across its networks. Situation management is a more preventive product: it gives an organization a better understanding of the size, shape and function of its network from the perspective of building better security services around that.
Dazz will continue to operate as a separate entity while being integrated into the larger Wiz package. Wiz has built a name for itself as a “one-stop shop,” and Rappaport said the integrated offering will remain a key part of that.
He believes this is in contrast to the way a lot of other SaaS companies are built. In the security industry, there’s “a lot of Frankenstein mashup, where companies prioritize revenue over building a single technology stack that actually works as a platform,” Rappaport said. Integration is arguably more important in cybersecurity than in other areas of enterprise IT.
Wiz and Dazz already had a close relationship in this deal. Mirat Bahat — the CEO who co-founded Dazz with Tomer Schwartz and Yuval Ofir (CTO and VP of R&D, respectively) — worked closely with Assaf Rappaport at Microsoft, which acquired his previous startup Adallom.
After Rappaport left to found Wiz with his former Adallom co-founders CTO Ami Luttwak, VP of Product Yinon Costica, and VP of R&D Roy Reznik, Bahat was one of the early investors. Likewise, when Bhatt launched Dazz, Assaf was a minority investor in it.
The connection is deeper than co-workers. Bahat and Rapaport are also close friends, and she was a second family to Mika, Rapaport’s beloved dog who was known as Wiz’s chief canine employee (integrated with LinkedIn profile). As the deal was sealed, the two faced two very sad developments: the death of Bhatt and Mika’s mother.
“We are hoping for a new chapter of positivity here,” Bhatt said. The cycle of life actually continues forward.
Rumors about this acquisition began to appear Earlier this month; That’s when they started talking seriously, Rapaport confirmed.
But these aren’t the only M&A talks Wiz has been involved in. Earlier this year, Google tried to buy Wiz itself for $23 billion to build a large cybersecurity business. Wiz pulled out of the deal, which would have been Google’s largest, in part because Rappaport said he believed Wiz could become a larger company on its own terms. This is what you are aiming for with this deal.
The acquisition is one of the first runs for Wiz, which earlier this year filled its coffers with $1 billion expressly for the purpose of mergers and acquisitions (it has raised nearly $2 billion in total, and we hear another round will close in several more weeks). Other trades included buying Jewel Security for $350 million, but Dazz is its largest acquisition to date.
There may be more mergers and acquisitions in the future. “We think next year will be a year of acquisitions for us,” Rappaport said.
Speaking to TC, Luttwak said one of Wiz’s priorities now is to create more tools for developers, addressing what they need to get their jobs done.
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 new ways to… To hack those systems. AI makes all of this significantly more difficult for malicious attackers. (It’s also an opportunity: a new generation of tools for our defense are all built on artificial intelligence.)
Wiz’s unique selling point was its holistic 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 lie, with more than a dozen products covering areas such as code security, Container environment, supply chain security, as well as digital partner integrations for those working with other providers (or to integrate functionality not directly offered by Wiz).
In fact, Wiz offers a degree of remediation to help prioritize and fix problems, but as Luttwak said, Dazz’s product is better.
“We now have a platform that can give you a 360-degree view of risks, including infrastructure and applications,” he said. “Dazz is the leader in attack surface posture management, the ability to collect vulnerability signals from the application layer across the stack, and build the most incredible context that allows you to trace them back to the engineers, to help with remediation.”
On Daz’s part, when I interviewed Bhatt in July 2024, when Daz raised $50 million from a $350 million valuation, she extolled the virtues of building a robust solution and said this week that the third quarter was “amazing.”
“But the momentum in the market is what ignites these types of deals,” she said. She confirmed that Dazz was receiving takeover offers from other companies as well. “If you think about the joint customers and clients we have with Wiz, it makes sense for them to have it on one platform.”
And some of Dazz’s competitors are still going it alone: Cyera, like Dazz, is an attack surface management expert, just yesterday Announce An increase of $300 million on a $5 billion valuation (to confirm our scoop). But what will he do with this money? Making acquisitions, of course.
Wiz says its annual recurring revenue is now $500 million (and aims to hit $1 billion in ARR next year), and counts more than 45% of the Fortune 100 as customers. Dazz said the ARR was in the tens of millions of dollars and is currently growing 500% on a customer base of about 100 organizations.
[ad_2]