The CEO of Wiz, reportedly exploring a $23B acquisition with Alphabet, says cybersecurity consolidation is ‘truly in its infancy’

While he repeatedly declined to comment on whether his own company was in talks with Alphabet over a reported potential $23 billion acquisition, Assaf Rappaport, Wiz CEO and cofounder, said that the industry was fragmented and that M&A was only just starting to ramp up.

“First and foremost, I think consolidation in the security market is truly in its infancy,” Rappaport, who was speaking at Fortune’s Brainstorm Tech conference in Deer Valley, Utah, said in an interview, noting that for companies, consolidating all their security measures into one platform is actually safer for them.

“It’s too fragmented, we’re going to see the consolidation,” Rappaport said of the cybersecurity market.

Rappaport also said that the trends in the market had shifted—and that founders are willing to look at alternatives, apart from an IPO, for an exit.

Rappaport said that consolidation was the reason that Wiz had raised its enormous $1 billion funding round earlier this year, at a $12 billion valuation, as the company looked for its own buying opportunities. Rappaport credited his company’s growth to the COVID pandemic in 2020, and how companies moved their businesses online and to the cloud, offering a boon for companies that specialize in safeguarding data that is stored there. “It felt like the worst time to form a company,” he said. “In hindsight, it was not.”

But Rappaport also said that he prefers to be able to grow in a more controlled way. “It’s great to be fast. But I prefer to be predictable and knowing where we’re going,” Rappaport said on stage.

The Wall Street Journal had reported on Sunday that Alphabet was in “advanced talks” to acquire the New York City-based cybersecurity startup for approximately $23 billion. Should the deal go through, it would be Alphabet’s largest acquisition ever, and would be one of just a few major M&A deals since 2022, when the change in interest rates shook up the market and the market for initial public offerings shrank significantly.