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Economic Times
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Wiz’s $32 billion win signals return of tech startup acquisitions
- Tech startup acquisitions are on the rise, with 11 deals over $1 billion totaling $54.5 billion so far this year, surpassing previous records.
- Google's $32 billion acquisition of cybersecurity startup Wiz marks the largest-ever deal for a venture-backed startup.
- Other recent major acquisitions include SoftBank's purchase of chip designer Ampere Computing for $6.5 billion and Scopely's acquisition of Niantic's gaming business for $3.5 billion.
- AI-related deals have been prominent, with acquisitions like CoreWeave buying Weights & Biases for $1.7 billion and ServiceNow acquiring Moveworks for $2.85 billion.
- The increase in acquisitions is seen as a positive development for Silicon Valley investors after a period of limited liquidity due to a lack of startup deals and IPOs.
- Changing policies under the new administration could be influencing the surge in acquisitions, as there is hope for a more favorable approach to antitrust.
- Recent market volatility and a high number of tech IPOs expected in the second quarter have shifted dynamics in negotiations, benefiting startup sales.
- The industry's focus on AI talent and technology, along with improved interest rates, are cited as key drivers for the current surge in M&A activity.
- Despite the increase in acquisitions, over 1,000 tech startups valued over $1 billion are still waiting to sell or go public, highlighting existing challenges in the market.
- The return of startup acquisitions offers potential windfalls for many companies that have been stagnant, potentially providing a path to liquidity and growth.
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