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Wiz turns down $23B Google deal
- jrflowers 2y ago“I’m turning down 65x ARR so that I can do an IPO” briefcase breaks open spilling out several pounds of scratcher tickets
- basementcat 2y agoDoes this mean that Google may be able to acquire the company for less money on the public markets if they just wait a bit?
- MenhirMike 2y agoDepends on how much of the stock is actually available to purchase. If the owners of the company keep 51% (or 50% + 1 share? Whatever it is), then no.
- dilyevsky 2y agoThe board has a fiduciary duty to consider a reasonable offer irrespective of what the float is
- rattray 2y agoI mean, if they think they can get to 1bn ARR reasonably soon and get, say, 30x on the public markets that's already a better outcome (plus they don't have to work at Google) -- and given their growth rate, an even better multiple might be expected.
- dilyevsky 2y ago30x arr (not cash flow) is unbelievably high multiple in the current environment
- samspenc 2y agoYeah, if we assume they are at 20% profit margin like FAANG or other tech / finance companies, at $1B ARR, they are making $200M net income per year. At 30-40 PE, they would be valued at $6-8B max. In reality, they are most likely losing money at this point like most startups, might take them a few years to hit profitability. But that doesn't seem to have stopped previous startups from commanding insane valuations, so maybe Wiz is able to do that too.
- rattray 2y agofacepalm – mixed up arr & cashflow as I was going to bed. thank you.
- deleted 2y ago[deleted]
- SavageBeast 2y agoYour comment made me go look at the P/E ratio of Alphabet itself - they're valued at 38x earnings. In this context turning down 65x ARR seems fucking insane at best.