Every time you turn on your computer or open your smartphone, there is an expectation that whatever you are doing is reasonably secure. There are things you are supposed to do if you go to the coffee shop and do things, but for the majority, the reality is with the greater access to WiFi, the average person opens up and is ready to go. This means the programs the people use must do most of the heavy lifting so people can use their devices.

In an article by Deborah Mary Sophia and Krystal Hu of Reuters, Alphabet (google) offered $32 billion to Wiz as it doubles down on cybersecurity. The reality is more and more companies are cloud based businesses and the competition includes Amazon’s AWS, Microsoft’s Azure, Oracle Cloud, IBM Cloud and Salesforce.

Last year Alphabet offered $23 billion but was rejected by the Israeli startup. The company was valued at $12 billion in a private funding round in 2024 and had $500 million in annual recurring revenues. The company was showing a continual growth pattern. The company was formed in 2020, and an early investor was Index Ventures which held 11% of the company which will be worth about $3.5 billion.

The CEO of Google Cloud Thomas Kurian kept in touch with the Wiz people and came back with a higher offer. The deal is set to close in 2026. When President Trump was elected, Wall Street felt the new administration would be more favorable to mergers and acquisitions and we will see. Mr. Kurian believes it to be the case.

The cloud generated more than $40 billion in revenues in 2024 and major customers include Morgan Stanley, BMW and LVMH.

Linking to dividend paying stocks, most companies do not do everything inhouse, some do, but it is rare. The reality is the large companies use many suppliers and as long as the company is successful, then they will be relying on suppliers. If you like the company, then look at their suppliers and see where the recurring revenues are and that can be a good opportunity for you to own them as well.

There are more questions than answers, till the next time – to raising questions.