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Figma Article

<hr /> Nope. It’s not a figma of your imagination. On the same day that U.S. Steel agreed to a <a target="_blank" href="https://6abc.com/us-steel-news-today-nippon/14197549/">hefty takeover</a> by Japan’s Nippon Steel, another deal in the software world was falling apart – one that delivered shock and awe when first announced in September of 2022.Fast forward 15 months and a steely resolve has been exchanged for tears of regulatory regret.Yesterday, <a target="_blank" href="https://www.adobe.com/">Adobe</a> – one of the leading technology platforms for creative, marketing, and digital experience software products – agreed to terminate its merger with <a target="_blank" href="https://www.figma.com/">Figma</a>, a collaborative tool for designing, prototyping, and testing web and app interfaces (among other things). When Adobe tendered its magnanimous offer of <a target="_blank" href="https://cmscritic.com/shock-and-awe-adobe-to-acquire-ui-design-platform-figma-for-20-billion">$20 billion</a> for Figma, its <a target="_blank" href="https://news.adobe.com/news/news-details/2022/Adobe-to-Acquire-Figma/default.aspx">press release</a> stated that the iconic company – responsible for legendary products like Photoshop – was “reimaging the future of creativity and productivity.” The truth, of course, is that Adobe was buying an up-and-coming competitor that had managed to do the impossible: attract millions of designers and developers away from its defacto product foothold, reflecting a troubling threat to its long-held grip on the creative industry. But it wasn’t just about Figma’s technology (the big secret is that it never is). As more alternatives to Adobe’s portfolio of products flooded the market – everything from design to video editing – a new generation of creators emerged. These remote digital nomads craved less “Paleolithic” desktop tools and drifted towards web-powered platforms with more flexible pricing models. For this new breed of user, Adobe felt tethered to the past, focusing more on specialists. Figma felt like the future, one where almost anyone can become a designer. That unique intersection of product, brand, and culture captured the zeitgeist of the moment, helping Figma become a key disruptor during the height of a booming, pandemic-infused digital economy.For Adobe, an acquisition made sense, allowing it to capture lost market share while tapping a whole new pipeline of prospects. For Figma? Well, there were 20 billion reasons to do it, despite marked resentment from its user base (just peruse some of the Subreddits on the subject). But hey, what can you do? Anytime a beloved software platform is eaten by a larger competitor (e.g. <a target="_blank" href="https://techcrunch.com/2022/10/26/four-years-after-being-acquired-by-microsoft-github-keeps-doing-its-thing/">Microsoft buying Github</a>, and the list goes on) there are vocal pessimists across the user community. As any Swifty would tell you, haters gonna hate. And there were questions from users, as you might expect, about how Figma would fit in Adobe’s mammoth portfolio of over 100 technologies. How would it align with Adobe XD, the company’s existing UX design offering? From a brand standpoint, would it follow the same track as Magento – now <a target="_blank" href="https://business.adobe.com/products/magento/magento-commerce.html">Adobe Commerce</a> – and slowly ride off into the sunset? Regardless of any user friction, the companies forged ahead, sharing plans around their combined superpowers. This included ambitions to leverage Figma’s web-based, multi-player capabilities with Adobe’s cloud offerings to make the creative process more productive and accessible. While talk of improving brainstorming and product design permeated the ethos, the strategic details were nebulous for obvious reasons: the deal was far from approved.  And that brings us to yesterday’s news. There’s a lot to unpack, but there are three key things I’ve taken away from the not-entirely-shocking revelation, and they have broader implications across the market – not just for Adobe and Figma. More importantly, I think this is good for both vendors in several ways, chiefly from an innovation perspective. And that’s good for everyone – even if there's a little heartache involved. <h3 id="1.-m&amp;a-has-changed-(for-better-or-worse)">1. M&amp;A has changed (for better or worse)</h3> Maybe it’s <a target="_blank" href="https://www.sec.gov/about/commissioners/gary-gensler">Gary Gensler</a> beating the war drum in a post-FTX world, or just rampant remorse over past decisions. Either way, the M&amp;A pipeline is being scrutinized more than ever by regulatory bodies, focused on preventing large players like Google from squashing competition with obscene amounts of cash. And $20 billion is, well, kinda obscene.In this case, the deal was scuttled by supposed clashes with governing bodies in Europe and the UK. Last month, Britain's Competition and Markets Authority (CMA) <a target="_blank" href="https://www.reuters.com/technology/adobe-figma-terminate-20-bln-deal-2023-12-18/#:~:text=Dec%2018%20(Reuters)%20%2D%20Adobe,buyouts%20of%20a%20software%20startup.">said the deal</a> would negatively impact innovation for software used by a large swath of the UK's digital designer marketplace. The EU voiced similar concerns, citing the potential for reduced competition.“Despite thousands of hours spent with regulators around the world detailing differences between our businesses, our products, and the markets we serve, we no longer see a path toward regulatory approval of the deal,” said <a target="_blank" href="https://www.linkedin.com/in/dylanfield/">Dylan Field</a>, Co-Founder and CEO of Figma, in a <a target="_blank" href="https://www.figma.com/blog/figma-adobe-abandon-proposed-merger/">blog post</a> yesterday.  Perhaps the compliance stamp on these software transactions isn’t as clear cut as, say, JetBlue and Spirit Airlines – which <a target="_blank" href="https://www.washingtonpost.com/transportation/2023/10/28/jetblue-sprit-merger-justice-department/">attempted to join forces</a> earlier this year (that merger was priced at a paltry $3.8 billion, BTW). But the same principles apply: it’s all about ensuring choice for consumers. At the same time, startup exits have slowed considerably in 2023, and VCs have tightened their belts – and their expectations. The white-hot halcyon days of 2021 and 2022 are in the rearview, and that’s been a persistent drag on raising capital (by all accounts, the investment market looks <a target="_blank" href="https://carta.com/blog/mergers-acquisitions-outlook-2024/">poised to rebound</a> next year). As firm managers command greater confidence around the scope and scale of any investment, they’re looking closer than ever at the multipliers. Which, in the case of Figma’s price tag, was heavily overweighted in 2022, and more so today.Also worth considering is the timetable for such a complex transaction. A lot has changed in the 15 months since the deal was announced, including the growth of Adobe’s stock price (the bigger story is the rise of generative AI, but more on that in a minute). Complexity and lengthy transaction cycles will likely continue to impact M&amp;A for the foreseeable future, but it's clear in this case how the dynamics can impact outcomes.  <h3 id="2.-figma-is-kicking-butt-–-so-why-not-go-for-the-ipo?">2. Figma is kicking butt – so why not go for the IPO?</h3>Sure, with the loss of Figma, Adobe is giving up an attractive jewel in its creative crown. But when that jewel outshines you, it's an even more precarious challenge.Let’s start with Figma’s revenue, which has grown from $400M to $600M since September of 2022. This is a far cry from a $20 billion valuation, but the company has demonstrated the level of profitability that might signal an IPO (when the time is right). But let’s add one more gold nugget to the prospecting pan. As part of the proposed acquisition, Adobe <a target="_blank" href="https://fortune.com/2023/12/18/adobe-figma-breakup-european-regulators-merger/">agreed to pay Figma</a> a whopping $1 billion breakup fee upon termination, to be paid almost immediately. Buoyed by this windfall, Figma will be well-positioned to focus on innovation over the coming years and fuel more competitive products and features – the likes of which will, without doubt, compete with Adobe. According to Figma's CEO, that’s already happening. Over the last 15 months, the company shipped a myriad of new products and expanded into the UK and Asia. In essence, they never stopped the growth machine – and it’s paying off. How’s the song go? Breaking up is hard to do. Maybe not in this case. If Figma plays its cards right, they can help users accelerate the design process and build digital products faster than ever. And in this hyper-paced product world, that’s the real deal. <h3 id="3.-ai-is-the-gamechanger-for-both-adobe-and-figma">3. AI is the gamechanger for both Adobe and Figma</h3>I keep conjuring that 15-month period from “buy” to “bye,” which equates to years in this new normal. Conditions were quite different when Adobe agreed to acquire Figma, and nowhere was that more evident than with the rise of artificial intelligence.Last September, generative AI wasn’t part of the common lexicon. ChatGPT had not yet enraptured the world. Since then, we’ve seen a massive investment in AI features across industries, specifically in areas like content and imagery – which is in Adobe and Figma's wheelhouse.In less than a year, platforms like <a target="_blank" href="https://www.canva.com/magic-write/">Canva</a> have introduced generative content within their design tools and <a target="_blank" href="https://cmscritic.com/products/kontentai">Kontent.ai</a> in their <a target="_blank" href="https://cmscritic.com/what-is-a-content-management-system-cms">headless CMS</a>. Image generators like Dall-E and <a target="_blank" href="https://www.midjourney.com/">Midjourney</a> are taking the visual potential of AI to entirely new levels (check the latter out, it will knock your socks off). AI is where Adobe has focused its future, leading the pack with innovative new offerings. Photoshop of old now features generative capabilities that are incredibly robust (if not a tad challenging to prompt). The company says more is on the way – and with billions in reserve, they have ample cash to keep innovating. Recently, Figma also joined the GenAI chorus, shipping its first <a target="_blank" href="https://www.figma.com/blog/introducing-ai-to-figjam/">native AI features</a>. Bolstered by its revenue growth and impending breakup bucks, they’ll have plenty of runway for expanding AI features and capabilities. Would Adobe float such a bloated number for Figma today? Not a chance – and AI is the chief determiner. That's why innovation in this area is essential for both players, and the mutual parting of ways is in their collective interest. There may be some head-to-head competition betwixt the two, but no matter. AI has changed the game, and could soon disrupt things even further. Platforms like <a target="_blank" href="https://uizard.io/">Uizard</a> are bubbling up, allowing users to ideate and design UI/UX with nothing more than an idea and a few prompts. Expect more of these players to enter the market in 2024 and create more choice – and maybe a little more chaos. <h3 id="a-designer-walks-into-a-bar…">A designer walks into a bar…</h3>… and asks the bartender, "Got any Helvetica?" The bartender replies: “Sorry, we don’t serve your type here.”Font humor aside, good design is no joke. When done well, it can be incredibly effective for communicating ideas. This goes back to the printed page and extends through modern application UX. Most importantly, design is for humans – even if it's not directly created by humans. That trend towards automation has been a constant in the design world, but the people part has never changed. I remember the first time I used Photoshop in college. It was astounding. Magical, even. It allowed users like me to explore new and imaginative pathways while accelerating the creative process. It only happened because Adobe committed to a culture of innovation – and with its latest crop of AI features, it appears to be continuing on that course.Are they sweating this breakup? Sure. A billion is a big number, and a lot to walk away from. A few shareholders might be miffed (although they're up 4 points today, which suggests otherwise). But in the end, they're still well-positioned across the portfolio of products. They've never been a one-trick pony, and the latest foray into composable components via its <a target="_blank" href="https://experienceleaguecommunities.adobe.com/t5/adobe-experience-manager-blogs/aem-franklin-helix-composability-pros-and-cons-aem-community/ba-p/600497">AEM Franklin Project </a>shows tremendous promise in other areas.  And who knows? They might just add multiplayer capabilities to Adobe XD – and give that missing jewel a run for its money.  As for Figma… oh, the money, honey. The $20 billion dream might be dead, but the horizon looks promising when considering the possibilities ahead. Flush with cash and a solid growth streak, the company might fare better as a free and independent entity. Figma’s founding vision was to “eliminate the gap between imagination and reality.” According to Field, the shift from a physical economy to a digital economy – powered by huge advances in AI – have combined to make that vision more attainable than ever for its growing community of designers.And those designers? Man, they're a unique breed. Artists with a penchant for technology. Adobe and Figma understand that audience intimately, albeit it’s evolving faster than ever. Only with a persistent focus on innovation will they have a shot at remaining competitive – not just with each other, but with the next wave of apps to come.Cut. Paste. Save.  <hr /><figure class="image"><img src="https://cmscritic.com/ms-content/uploads/2023/11/cms-kickoff-2024-banner.jpg" /></figure><h3 id="join-us-at-cms-kickoff-2024---january-16-17">Join us at CMS Kickoff 2024 - January 16-17</h3>CMS Critic is a proud partner at this second annual edition of the prestigious international Boye &amp; Co conference, dedicated to the global CMS community. This event will bring together top-notch speakers, Boye &amp; Co's renowned learning format, and engaging social events.Tired of impersonal and overwhelming gatherings? Picture this event as a unique blend of masterclasses, insightful talks, interactive discussions, impactful learning sessions, and authentic networking opportunities. 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Dubbed the “Pink Palace,” this majestic hotel and resort provides a stunning backdrop to the conference, along with access to the local food and culture of St. Petersburg Beach.  <h4 id="get-your-tickets-today">Get your tickets today</h4>CMS Kickoff offers an intimate, highly focused experience. Space is limited, and only a few seats remain. Don't miss this exclusive opportunity!<a target="_blank" href="https://www.boye-co.com/conferences/cmskickoff24/tickets">Purchase tickets now &gt;</a>

Cut, Paste, Delete: Why Adobe’s Canceled Merger with Figma is Good for Innovation 

matt-garrepy

No. It's not just a "figma" of your imagination. 
<a href="https://www.figma.com/blog/a-new-collaboration-with-adobe/" target="_blank">Adobe has agreed to spend $20 billion</a> – that's billion, with a "b" – to buy <a href="https://www.figma.com/" target="_blank">Figma</a>, the popular web-based collaboration and UI design platform. 
We'll give you a minute to pick your jaw up off the ground. 
Adobe said it expects the transaction to close sometime in 2023. That said, the deal has not yet been approved by Figma stockholders and must proceed through customary closing. The dollars are a mix: about half the total will be paid in Adobe stock, with the balance paid in cash. 
If you're not familiar with Figma, you will be now – but it's worth noting how awesome a platform it really is. It offers a deep set of collaboration options for joint software development, as well as its popular FigJam collaborative whiteboarding environment. If you haven't used that wipeboarding feature before, we highly recommend it. 
By now, we’re accustomed to Adobe spending big bucks to expand its copious monolith. These tasty acquisitions have bolstered its stronghold on the digital experience category – and while there may not be an Iron Throne to claim, it has certainly earned the crown as the King of the <a href="https://www.gartner.com/en/documents/3995917" target="_blank">Gartner Magic Quadrant for DXPs</a>.
But forget all that. Forget the fact that <a href="https://www.computerworld.com/article/3673934/adobes-20b-figma-acquisition-highlights-web-based-collaboration-trends.html#:~:text=The%20%2420%20billion%20figure%20is,a%20dedicated%20following%20among%20developers." target="_blank">Figma was valued at around $10 billion</a> at its last funding round in 2021 (meaning this purchase doubled the bounty). And let's not overlook that the market has been in a bout of turmoil lately, especially for tech stocks.
No – what's been really interesting is how this acquisition triggered such an emotional response from the market. Despite Adobe's enthusiasm about the deal, the Figma fanbase seemed a little less enthusiastic…
<img style="max-width:800px" src="https://cmscritic.com/ms-content/uploads/2022/09/luke-skywalker-meme-no.jpg" alt="Luke Skywalker meme" />
And just like that, the Empire Strikes Back.
<h2>Why Figma? And why the pushback from fans?</h2>
The Figma acquisition speaks volumes about the growth of web collaboration software and the central role of design. But for its users, Figma represented everything Adobe wasn’t. In fact, Figma was a sort of the anti-Adobe. 
The fanbase has reason to be concerned: Adobe could bring Figma aboard the mothership under its expensive subscription model. There could be some poor integration or uncomfortable bloat. Even worse, it could become the kind of bolted-on utility that's prone to crashing – kind of like the Millennium Falcon with a broken hyperdrive.
Or, Adobe could do wonders with this amazing platform, building deeper functionality that expands the frontier for web-based collaboration within its toolsets. Figma's flexibility could be a game changer for the company and removes one of its digital experience rivals from the chessboard. 
One thing both companies have in common is the commitment to design. Founded by Dylan Field in 2016, Figma has held to the mantra that design should be collaborative, web-based, and real-time – with the mission to “open up” and move from the solitary design process. Figma has crystallized the concepts of sharing ideas and working collaboratively, something that Adobe’s UI design products like Photoshop have struggled to embrace. 
As for the fans, that's a product of Figma's heavy emphasis on community, which they have nurtured and grown over the years. This was likely a big driver of <a href="https://www.crunchbase.com/organization/figma/company_financials" target="_blank">Figma’s unicorn valuation</a>, which skyrocketed from <a href="https://www.bloomberg.com/news/articles/2021-06-24/software-design-startup-figma-is-now-worth-10-billion" target="_blank">$2 billion to $10 billion</a> in just a year. With more than 4 million users, including giants such as Microsoft, Slack, Google, Dropbox, and Twitter, the company has achieved the kind of presence and loyalty that are the envy of the tech world.
 
<img src="https://cmscritic.com/ms-content/uploads/2022/09/nothing-great-is-made-alone.jpg" alt="Figma - Nothing Great is Made Alone" />
<h2> </h2>
<h2>Adobe XD vs. Figma</h2>
So let's get down to brass tacks: Adobe XD and Figma are currently the most popular design tools on the market, both with similar features. For the past 5 years, Figma has been the biggest rival and competitor to Adobe XD, but Figma has managed to with the hearts of the design community. 
Figma believes the acquisition will help the Figma platform benefit from Adobe’s technology, expertise, and resources in the creative space. Figma has big ambitions for its products, with plans to improve its <a href="https://www.figma.com/design/" target="_blank">Figma Design</a>, <a href="https://www.figma.com/figjam/" target="_blank">FigJam</a>, and the <a href="https://www.figma.com/community/" target="_blank">Figma community</a> platforms while expanding into new areas.
“We will have the opportunity to incorporate their expertise in imaging, photography, illustration, video, 3D, and font technology to the Figma platform," said <a href="https://twitter.com/zoink" target="_blank">Dylan Field</a>, Co-founder &amp; CEO of Figma. "Additionally, we will have the opportunity to reimagine what the best creative tools could look like within the Figma technology stack.”
Top-down leadership is key in these kinds of earth-shattering transitions. Taking designers’ concerns into account, Field reassured the Figma community that he will remain CEO and that Figma will keep operating autonomously – without compromising its culture, the way it runs its business, and (perhaps most importantly) its pricing. 
<h2>Growth by Acquisition</h2>
The news from Adobe is huge – but maybe not that surprising. Adobe has been driving growth by investing in tools and products to execute complex workflows across teams. As part of this evolution, it <a href="https://news.adobe.com/news/news-details/2020/Adobe-to-Acquire-Workfront/default.aspx" target="_blank">acquired Workflow</a> – a leading work management platform for marketers – for $1.50 billion in 2020. Last year, <a href="https://www.cmscritic.com/adobe-acquires-video-collaboration-platform-frame-io/" target="_blank">Adobe also acquired Frame.io</a>, an industry-leading collaboration platform, for $1.275 billion. 
In its <a href="https://news.adobe.com/news/news-details/2022/Adobe-to-Acquire-Figma/default.aspx" target="_blank">press release</a>, Adobe stated that Figma’s web-based, multi-player capabilities will accelerate the delivery of Adobe’s Creative Cloud technologies on the web, making the creative process more productive and accessible to more people.
With this acquisition, Adobe once more solidified its position in the creative industry. With responsive design taking over about a decade ago, other apps such as <a href="https://www.omnigroup.com/omnigraffle/" target="_blank">Omnigraffle</a> and later <a href="https://www.sketch.com/" target="_blank">Sketch App</a> were born – and embraced by designers by offering a better solution for creating wireframes and high-fidelity prototypes suited for the responsive web. This was a huge departure from Photoshop and Illustrator and their respectively rigid structures. 
Figma is not alone in the web-based collaboration and UI design space. Platforms like <a href="https://www.cmscritic.com/uxpin-merge-review-sync-react-components-with-prototypes/">UXPin</a>, another subscription-based wireframing and prototyping tool, are effectively <a href="https://www.cmscritic.com/uxpin-merge-review-sync-react-components-with-prototypes/" target="_blank">bridging the gap between designers and developers</a>. 
As Figma zeroes in on $400 million in revenues at the end of 2022, it's safe to say that there's ample potential in this growing market space – and we'll have to see how Adobe's mindboggling acquisition brings imagination to life. 
<h2>About Figma</h2>
Figma is the open design company founded in 2012 by Dylan Field and Evan Wallace. With Figma’s cloud-based screen design tool, teams achieve a shared understanding around design without worrying about syncing, exporting, or installing software. Anyone involved in the product development process can always share up-to-date files with a link. That makes it easy to collaborate on the latest designs and prototypes and see their code attributes. Figma has simplified collaboration across the entire design process for thousands of companies like Microsoft, Slack, and Uber and millions of users, including designers, developers, product managers, marketers, and others.

Shock and Awe: Adobe to Acquire UI Design Platform Figma for $20 Billion

paris-tuzun

Explore a wide range of informative articles on Figma, insights, and industry updates. Stay informed and ahead of the curve with our diverse collection of news and posts covering the latest trends and developments in the industry

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Cut, Paste, Delete: Why Adobe’s Canceled Merger with Figma is Good for Innovation

Shock and Awe: Adobe to Acquire UI Design Platform Figma for $20 Billion