Big news in the world of digital creative tech: Adobe today announced that it would acquire Figma for $20 billion, taking out one of its biggest rivals in the realm of digital design.
Both the WSJ and Bloomberg reported earlier this morning that Adobe was close to announcing the deal to acquire Figma. In the end, Adobe confirmed the news to coincide with its quarterly earnings.
(Those earnings saw the company post revenues of $4.43 billion and non-GAAP earnings per share of $3.40, which respectively met and exceeded analysts’ expectations. Nevertheless, the stock is trading down nearly 8% pre-market open.)
The deal is a mix of cash and stock, Adobe said. The deal is expected to close in 2023, “subject to the receipt of required regulatory clearances and approvals and the satisfaction of other closing conditions, including the approval of Figma’s stockholders.”
“Adobe’s greatness has been rooted in our ability to create new categories and deliver cutting-edge technologies through organic innovation and inorganic acquisitions,” said Shantanu Narayen, chairman and CEO, Adobe, in a statement. “The combination of Adobe and Figma is transformational and will accelerate our vision for collaborative creativity.”
“With Adobe’s amazing innovation and expertise, especially in 3D, video, vector, imaging and fonts, we can further reimagine end-to-end product design in the browser, while building new tools and spaces to empower customers to design products faster and more easily,” added Dylan Field, co-founder and CEO, Figma. He will stay on and continue to lead the company, said Adobe.
$20 billion is a sizable jump for Figma, which was last valued at $10 billion in June 2021, when it raised $200 million, but Adobe is doing more than just taking out a big competitor. It’s picking up a fast-scaling business: it notes that Figma’s total addressable market is $16.5 billion by 2025.
“The company is expected to add approximately $200 million in net new ARR this year, surpassing $400 million in total ARR exiting 2022, with best-in-class net dollar retention of greater than 150 percent. With gross margins of approximately 90 percent and positive operating cash flows, Figma has built an efficient, high-growth business,” it said.
Field is due to speak at our Disrupt event this year: hopefully (!) he still makes it — it will be a hell of a session if he does.
More to come.
Adobe snaps up Figma for $20B, taking out one of its biggest rivals in digital design by Ingrid Lunden originally published on TechCrunch
