Upwind rejects Datadog’s $3.8 billion approach, source says

Upwind, a San Francisco cloud-security startup, rejected an acquisition approach from Datadog because it offered no premium over the $3.8 billion valuation set by venture investors, an unnamed person familiar with Upwind told TechCrunch in its October 28 report. The person said Upwind chose to remain independent and that the approach nearly derailed a financing process that had been under way for months.

The acquisition accounts conflict. On October 22, CTech said it had learned that a nearly $4 billion Datadog offer described by The Information had not been made. That was CTech’s account, not a denial attributed to either company. TechCrunch said it had contacted both Upwind and Datadog for comment.

What the revenue figures measure

Annualized recurring revenue (ARR) expresses recurring business, such as subscriptions or services, at a yearly rate. Upwind’s reported quarterly additions increase that annual rate; they are not revenue earned during each quarter. The year-end projection likewise describes an expected annual rate at that point, not total revenue earned during 2026.

CTech’s October 22 account cited The Information for Upwind’s earlier ARR levels. The quarterly additions and year-end forecast come from an unnamed person familiar with Upwind’s financials who spoke to TechCrunch.

Using that year-end forecast, TechCrunch puts the $3.8 billion valuation at more than 40 times ARR. The comparison rests on the projected annual rate, not realized annual revenue.

Upwind still attracts acquisition interest, a source says

Founded in 2022 by Amiram Shachar, Upwind describes its approach as “runtime” cloud security: detecting and remedying attacks and vulnerabilities while services are running. Datadog is a publicly traded company that sells tools for monitoring how software runs.

An unnamed person familiar with Upwind told TechCrunch that the company continues to attract acquisition interest.