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Returns for early investors up to 200x

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Cyberstarts turns $6.4 million into $1.3 billion

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Index Ventures largest shareholder with 12%

By Krystal Hu

March 18 (Reuters) - The venture capital firms that

invested in cybersecurity firm Wiz, which agreed to a $32

billion buyout by Google's parent Alphabet, stand to

reap returns as high as 200 times for seed investors, among them

Sequoia Capital, Cyberstarts and Index Ventures.

The $32 billion all-cash Wiz deal on Tuesday marked a major

win for about 25 firms on Wiz's cap table, according to

PitchBook, a rarity in the past few years as high interest rates

and tight antitrust scrutiny reduced exit events.

Among the investors, the biggest beneficiaries are those

that put money into Wiz early and continued to invest over the

years. Their success demonstrated the power law in venture

capital when a small number of investments generate the majority

of returns.

Israel-based early-stage firm Cyberstarts co-led a $21

million seed round in Wiz in February 2020 that valued the

company at around $67 million post-money.

While it also invested in follow-on rounds, Cyberstarts'

biggest win is $6.4 million invested in its first seed fund,

worth about $1.3 billion when the deal goes through. That

represents a return of more than 200 times within five years,

according to a source familiar with the performance, a home run

in an industry built on them.

Silicon Valley heavyweight Sequoia enjoyed similar success

by investing early, with an initial $10 million in the seed

round. After committing more in later rounds, it now owns about

a 10% stake in Wiz and could reap $3 billion from the sale,

sources said.

Index Ventures, now the largest shareholder in Wiz, has

about a 12% stake, which could translate to over $3.8 billion in

cash when the transaction is completed, sources added.

The firm's partners Gili Raanan, Doug Leone and Shardul Shah

sit on Wiz's board. They got to know Wiz CEO Assaf Rappaport, a

former captain in the Israel Defense Forces, and his founding

team in his first company, which was acquired by Microsoft.

When the team founded Wiz in 2020, Cyberstarts, Index

Ventures and Sequoia were quick to invest.

For some investors, the success is both personal and

professional. "We have known each other for years, talk weekly

and attend each other's birthday parties," Cyberstarts founder

Raanan said in an interview.

Cyberstarts Opportunity Fund, which invested in Wiz in 2024,

is turning its $40 million investment into $128 million. Thrive

Capital, a firm known for its concentrated late-stage bets, is

securing a quick win with a $1 billion stake after leading Wiz's

most recent two funding rounds, one at a $12 billion valuation

and one at $16 billion in an employee tender offer late last

year, the source added.