Design software giant Adobe will acquire rival collaborative design platform Figma in a deal worth $29.7 billion (US$20 billion) in cash and stock.
The acquisition was announced last week and is one of the biggest software company purchases in recent years, following Salesforce’s $37 billion (27.7 billion) purchase of workplace communication tool Slack in 2020.
“Figma has built a phenomenal product design platform on the web,” said David Wadhwani, President of Adobe’s Digital Media Business under which Figma will operate.
“We look forward to partnering with their incredible team and vibrant community to accelerate our joint mission to reimagine the future of creativity and productivity.”
Figma is a collaborative, web-based platform for designing user interfaces – akin to a Google Docs for app design.
Dylan Field and Evan Wallace co-founded Figma in 2012 and have since positioned the company as an independent alternative to giants like Adobe, even including a section on its website explaining why designers “are making the switch from Creative Cloud to Figma”.
In early 2021, Field responded to a Twitter thread complaining about Adobe in which someone had suggested Figma would eventually replace Adobe.
“Our goal is to be Figma not Adobe,” he wrote – what a difference 18 months and nearly $30 billion can make.
Our goal is to be Figma not Adobe— Dylan Field (@zoink) January 29, 2021
In a blog post about the acquisition, Field said the deal provides an opportunity “to accelerate the growth and innovation of the Figma platform” using Adobe’s resources.
“When we started Figma, our stated vision was to ‘eliminate the gap between imagination and reality’,” he wrote.
“I believe we can reach this goal substantially faster through our plan to join forces with Adobe and leveraging their legendary team plus decades of expertise.”
Further consolidation of the design software market leaves Australian darling Canva as one of the few major independent players that hasn’t yet been swallowed up by a tech giant.
As for why Adobe chose to spend $30 billion on Figma, startup founder and investor Amal Dorai gave his take in a Twitter thread explaining the difficulties of turning legacy applications into multi-user ones.
I'm not surprised that Adobe is acquiring Figma for $20B, nor that Wall Street doesn't understand it and $ADBE stock is down more than $20B today. It's a smart move for Adobe because it's nearly impossible to make legacy software applications multi-user collaborative. Thread: 🧵— Amal Dorai (@amaldorai) September 15, 2022
Doral founded a startup called LiveLoop which Microsoft bought in 2015 to make its Office suite collaborative in real-time.
He said for companies like Adobe and Microsoft, it’s simply “cheaper and easier” to rebuild their apps using a former competitor’s architecture than to shoehorn features into outdated systems.
“Multiplayer collaboration is the future of all applications, and Figma is by far the richest multiplayer collaborative app,” he concluded.
“This will go down as one of the smartest software acquisitions of all time, and if there are regrets they will be only Microsoft's, for not offering more.”