The Twenty Minute VCJason Lemkin: Crowdstrike, WTF Happens From Here? Wiz Rejects Google’s $23BN Acquisition Offer|E1181
At a glance
WHAT IT’S REALLY ABOUT
Jason Lemkin Dissects Wiz’s Rejection, CrowdStrike Meltdown, And Venture Delusion
- Jason Lemkin joins Harry Stebbings to unpack Wiz’s decision to reject Google’s $23B acquisition offer, arguing the price wasn’t crazy given Wiz’s growth and likely $1B forward ARR, but antitrust risk and distraction made an IPO path more rational for founders and late-stage investors.
- They examine CrowdStrike’s catastrophic update that grounded airlines and crippled systems worldwide, critiquing its crisis communications and forecasting weaker upsell/NRR but limited near‑term churn, with Lemkin expecting markets to partially re-rate the stock once the dust settles.
- The conversation broadens into today’s liquidity drought in venture, the pretense many funds are maintaining while deploying capital as if it were 2021, and the long tail of 1x funds likely to emerge from recent vintages.
- They close by discussing late‑blooming winners like Clio, AI “feature parity” in SaaS (including Harvey.ai), under‑ and over‑appreciated public names like Klaviyo and Snowflake, and Lemkin’s own regrets around outbound sourcing and recruiting in venture.
IDEAS WORTH REMEMBERING
5 ideasWiz likely made a rational choice rejecting Google’s $23B offer due to antitrust risk and distraction, not price.
At ~46x current ARR but roughly 20x forward ARR on an imminent $1B run-rate, Lemkin sees the offer as rich but not insane; the bigger issue was 18–24 months of regulatory overhang with a real chance of deal failure, which could severely damage momentum and culture.
In the current environment, founders should be biased toward taking strong acquisition offers, but exceptional outliers like Wiz can justify going public.
Lemkin now tells most founders to take meaningful exits because public life brings activist pressure, slowing growth, and long-term stress; Wiz is a rare case where growth, scale, and founder wealth already achieved make the IPO risk/return tradeoff acceptable.
Big tech M&A is driven by “chips” in good times, but antitrust has structurally reduced large-deal liquidity.
When cloud units are growing fast, leaders get political capital (“chips”) to spend on transformative deals like Wiz or HubSpot; however, cases like Adobe–Figma show regulators will block even non-obvious overlaps, meaning large M&A can no longer be relied on as a systemic liquidity valve.
CrowdStrike’s outage probably won’t cause mass churn, but it will hurt upsell, NRR, and brand for several quarters.
Because endpoint security is deeply embedded, true vendor swaps take 3–5 years; most customers will grant one pass—especially since this wasn’t a security breach—but sales teams will struggle to cross-sell 30+ modules into angry accounts, compressing expansion revenue.
Venture is “pretending” on liquidity: many funds will end at ~1x despite continuing to deploy aggressively.
With IPO and M&A markets constrained since late 2021, Lemkin expects a generation of funds to barely return capital; yet managers keep investing at near-2021 pace to maintain brand momentum and fee streams, rather than pacing strictly to realized liquidity.
WORDS WORTH SAVING
5 quotesIn venture, we're all pretending.
— Jason Lemkin
Your job in venture is not to modulate your pace. Your job is to find Wiz.
— Jason Lemkin
You gotta let your vendors screw up once every five years.
— Jason Lemkin
Most of us can’t be Wiz, but maybe we can be Clio.
— Jason Lemkin
There are so many funds that will end up a whole generation of 1x funds.
— Jason Lemkin
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