This potential Google acquisition could disrupt VC in 2024 - 7/23/24

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Hey SaaS Sentinel reader. Welcome back. This week, the EU re-elected president is ushering in big changes for Europe’s tech scene, scammers are taking full advantage of CrowStrike’s massive tech outage, and a potential acquisition from Google parent company, Alphabet, could have a massive ripple effect across VC this year.

• EU Chief Von der Leyen wins her second term and has big plans for the EU’s tech scene

• Scammers are launching massive phishing scams after CrowdStrike’s global tech outage

• Google parent company Alphabet is reportedly in advanced talks to purchase cybersecurity startup Wiz for $23 billion

EU Chief Von der Leyen Wins Second Term: What It Means for Tech

Ursula von der Leyen has secured another five-year term as President of the European Commission, winning a decisive vote from EU lawmakers this week. Her re-election signals a desire for continuity of leadership amid turbulent geopolitics. 

…but what does it mean for the future of technology regulation and innovation in Europe?

Von der Leyen has already overseen major reforms in digital policy during her first term, including passage of landmark regulations like the Digital Markets Act (DMA) and Digital Services Act (DSA). These new rules take aim at the immense power held by Big Tech giants, imposing constraints on businesses like Google, Apple, Facebook and Amazon. On top of that, the EU also passed legislative measures aimed at enabling more data access for businesses, researchers, the public sector and consumers. 

Now in her second term, von der Leyen is set to ramp up enforcement and oversight to ensure tech titans comply with the EU's vision for fairer digital markets. “We will tackle unethical techniques used by online platforms by taking action on the addictive design of online services, such as infinite scroll, default auto play or constant push,” she writes. “We will also firmly combat the growing trend of abusive behavior online with an action plan against cyberbullying.”

Boosting European innovation will be another priority for Leyen, including bigger investments in emerging tech spheres like AI and biotech.

However, Leyen’s plan for the future of Europe’s role in the global tech scene is best summed up in a recent executive note of her policy approach: “The world is in a race that will dictate who will be the first to climate neutrality and first to develop the technologies that will shape the global economy for decades to come. Europe cannot afford to fall behind and lose its competitive edge in this race, nor can it leave any strategic vulnerabilities exposed.”

Read more.

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How Scammers Are Taking Advantage of CrowdStrike’s Massive Tech Outage

The worldwide havoc caused by a faulty software update from cybersecurity firm CrowdStrike last week presented a prime opportunity for online scammers and phishing schemes. And boy did they take advantage of it

Malicious actors are posing as CrowdStrike employees in targeted emails and calls offering to help companies impacted by the glitch, which impacted an estimated 8.5 million Windows devices. Though that's less than 1% of Microsoft machines, the tech issues had cascading impacts on travel, healthcare, and supply chains due to extreme digital interconnectedness.

The aviation sector was hit especially hard—airlines collectively canceled over 5,000 flights last Friday when the outages peaked. Delta alone scrubbed 25% of its Saturday flights as crews and aircraft remained out of position the next day, trying to regain normal operations.

For hospitals across the globe, cancelled surgeries, appointment delays and restricted access to patient records during the disruption showcased vulnerabilities in increasingly digital-dependent care. Most systems are slowly coming back online, but many medical groups said that they’re relying on analog backups to protect sensitive patient records.

Restoring affected systems fully could take a week or more. In the interim, government officials and cybersecurity experts warn that scammers now possess detailed data for launching surgically targeted phishing strikes on struggling firms. Their advice? Utilize only genuine recovery solutions from reputable providers like Microsoft and CrowdStrike.

Read more.

How Alphabet's Massive Wiz Buyout Could Spark Exits and Deals

Google parent company, Alphabet, is reportedly in advanced talks to purchase cybersecurity startup Wiz for $23 billion—its largest acquisition ever if completed. The blockbuster deal could have wide-ranging impacts on the tech world.

Despite M&A activity lagging this year, experts say the size of this exit could catalyze the market for startups looking for buyers. And, more importantly for early-stage founders, It proves that mammoth returns are possible even for young companies, with 4-year-old Wiz fetching a huge price tag.

The liquidity crunch that's currently strangling late-stage startups likely won't be eased much though. Only the tech titans like Google have the balance sheets needed to swallow deals this big. But it might make investors less hesitant to fund venture capital again (fingers crossed).

Angela Lee, a professor at Columbia Business School and a founder of angel investor community 37 Angels, even stated that if Alphabet acquires Wiz, she thinks it could be enough of a catalyst to give the startup M&A market some momentum.

“The size of the acquisition, which is huge—the market is very much ready for an exit of this size,” Lee said. “There is this fear that no one wants to be the first to stick their neck out. My hope is that this will revitalize the M&A market.”

Of course, nothing is guaranteed yet. Regulatory obstacles could derail or prolong tie-up talks. But Alphabet absorbing Wiz would undoubtedly send shockwaves through the industry. And those tremors may just include renewed momentum for startups seeking backers and buyers.

Read more.

Parting Thoughts

Well, that’s the tech news for this week. Hit reply and let us know—did you learn something from today’s newsletter?

Until next time!