- Alphabet is nearing a $23 billion acquisition of Israeli cybersecurity firm Wiz, founded by Assaf Rappaport, a veteran of Israel’s elite 8200 intelligence unit.
- Israel’s military intelligence units, especially Unit 8200, have served as a breeding ground for tech talent, empowering young soldiers with advanced tech skills.
OUR TAKE
The potential Alphabet-Wiz deal showcases Israel’s tech prowess and military-to-tech talent pipeline, underlining its status as a global tech leader. Despite regional challenges, Israel’s tech sector thrives, attracting major acquisitions and investments, thanks to its innovative ecosystem fostered by units like 8200.
–Vicky Wu, BTW reporter
What happened
Alphabet, Google’s parent company, is reportedly in the final stages of negotiating the acquisition of Wiz, an Israeli cybersecurity giant founded by Assaf Rappaport from Israel’s elite 8200 intelligence unit, in a deal rumoured to be worth a staggering $23 billion.
Should the acquisition proceed, it would rank amongst the largest in Israel’s history, eclipsing Intel’s $15.3 billion acquisition of Mobileye in 2017. Industry analysts anticipate that this transaction could spur additional significant investments in Israeli tech companies, further cementing the country’s reputation as a global tech hub.
The potential deal would reinforce the notion that, despite regional unrest, Israel’s tech industry remains a resilient and vibrant part of its economy, contributing a significant 20% to the nation’s GDP and accounting for roughly 15% of its workforce. This potential acquisition would not only highlight the unit’s critical role in nurturing tech talent, but also underscore the robustness of Israel’s tech sector amidst the economic pressures of the Gaza conflict.
Also read: Gemini robot revolutionises office tasks at Google DeepMind
Also read: Google-based GitLab ‘s $8B future: Datadog eyes giant acquisition
Why it’s important
Israel’s emergence as the world’s second-leading tech hub, trailing only Silicon Valley, significantly credits the collaborative efforts between its military intelligence units, notably Unit 8200, and academic institutions. These organisations cultivate an environment conducive to technological innovation, spawning numerous successful startups. Assaf Rappaport, a key figure in the tech landscape, lauds his military service in Unit 8200, likening it to “the best school of entrepreneurship.” As Israel’s top data collection division, akin to the U.S. NSA, Unit 8200 empowers young soldiers with advanced tech skills, laying the groundwork for their future contributions to the civilian tech industry.
During his service in the unit, Rappaport collaborated with fellow veterans and founded Adallom, a cloud security firm, in 2012. Their combined expertise and synergy culminated in a lucrative exit when Microsoft acquired Adallom for $320 million merely three years later.
Capitalising on their shared experiences and the skills honed during their military service, the quartet embarked on another venture in 2020, amidst the onset of the COVID pandemic. This time, they launched Wiz, a cybersecurity company focused on cloud protection. The firm experienced meteoric growth, achieving a $12 billion valuation following a $1 billion fundraising round in May of the current year.
“In a way it’s like raising tigers and then releasing them to the wild,” Gili Raanan, founder of Venture capital firm Cyberstarts and general partner at Sequoia Capital said of the intelligence units.
