Cloud security startup Wiz launched just two years ago. It released its first product about 18 months ago. In December the company announced a $550 million Series A on a $6 billion valuation. That’s a lot of money for an early-stage startup, and it put a lot of pressure on the founders to live up to such gaudy numbers.
It seems they haven’t had much trouble, if their company's latest ARR figures are any indication. Wiz claims to be the fastest company ever to $100 million in annual recurring revenue (ARR), scaling from $1 million to $100 million in ARR in just over 18 months, from February 2021 to approximately July 2022, according the company.
The chart below shows the data they used to determine how they were fastest, based on Bessemer Ventures State of the Cloud report.
Image Credits: Wiz, Bessemer Ventures
It’s an impressive feat reaching such a substantial ARR figure so quickly, a number it sometimes takes years for companies to achieve. Company co-founder and CEO Assaf Rappaport is proud of the accomplishment, but is trying to keep it in proper perspective.
“First of all, to be the fastest company to $100 million ARR is not a goal [we had]. And it's not, by the way, a guarantee for future success. It's a milestone. It's a small milestone in a long journey for us,” Rappaport told TechCrunch.
He said the way to get to a revenue number like that is to concentrate on the customers, with his company targeting high-value customers from the beginning. “I would tell you that the one thing that was important for us from the get-go was that it was all about the customer, and from day one we were focusing on the thought leaders of the security world and cloud security,” he said.
He sees that breaking down into two groups: first are corporations that aren’t necessarily technology-first like BMW, Blackstone and Costco. The second group is software companies like Salesforce, Snowflake and Slack (which Salesforce acquired at the end of 2020).
Doug Leone, who until recently was global managing partner at Sequoia Capital, but is still a Wiz board member, says he never wavered when it came to investing big money in the company.
“We believe [being a] quality company trumps pricing, and the difference is only time. And so a quality company will excel for the long term. And [regardless of what you pay], quality is how we have learned over the years we generate our greatest returns. And so the question is really, is this a quality company, and early indicators in the first 18 months would suggest that it is and far more, and that then tells us that we're going to be rewarded over the long-term horizon,” he said.
Shardul Shah, a partner at investor Index Ventures, says the company is addressing a common problem with cloud security and that’s why it’s resonating with customers, and why his firm is all in. “That's allowed it to have unprecedented growth while navigating into uncharted territories, which is why we've invested as much money as possible at every opportunity with a lot of conviction that this can be one of the most significant companies related to cloud security that we've seen,” Shah said.
The company has not been standing still since raising in December, but continues to invest deeply into the product creating a series of new services that point to it becoming a platform play, often a signal that it really does want to be around for the long term instead of a company that gets sold to be part of a platform company. This includes support for all major clouds, including the big three -- AWS, Microsoft and Google -- along with Oracle and Alibaba clouds.
At the core of the Wiz solution is a security graph that not only helps identify possible issues that could lead to problems, but also correlates all of that information across the different areas that a company is trying to protect, whether that's the network, identity, secrets or workloads. By showing these connections, the company believes it can help plug security holes and find issues much faster than competitor solutions. When you combine that with a solution that installs and starts delivering information about the environment quickly, this has led to this rapid momentum the company has experienced since it came out of the gate with its first product 18 months ago.
It's worth noting that the company had less than 200 employees when I spoke to Rappaport in December. Today it is closing in on 500 and expects to reach 700 to 800 by the end of the year as they continue to hire aggressively.
As Rappaport said, the $100 million ARR number is just a blip in the scheme of things. The company still has to continue to execute and continue to serve customers, but for a company barely two years old, with hundreds of customers -- they won’t share an exact number -- they are certainly off to as good a start as any startup and its investors could hope for.