All this is to say:Īdobe XD is a considerable investment Adobe has worked on it for more than seven years įigma not reporting to the head of Creative Cloud sends a bad signal to me, almost a red flag. But the market is vast and diverse you might be surprised how many companies are using Adobe XD over Figma. 2021, source: Īs a user, we may view products as 1 or 0 - if I don’t use it, it almost doesn’t exist. Compared to 2020 design tools survey, Adobe XD is on the rise - it jumped from 3rd to 2nd place in UI prototyping category and shortened the gap between itself and 2nd place in the UI design category: Design Tools Survey 2020 vs. While it is surely not as popular as Figma, it is nothing less than a successful product, strengthening the Creative Cloud ecosystem. According to the 2021 design tools survey (the latest, 2022 survey has yet to come out), Adobe XD is the 3rd most popular UI design tool and 2nd most popular UI prototyping tool. The answer, I now speculate as an outsider, is that David Wadhwani is the one who led and pushed through the acquisition, not Scott Belsky therefore, the new Figma org reports to him.Īdobe has invested heavily in Adobe XD, first announced to public as Project Comet in Oct 2015, 7 years ago. After the acquisition announcement, the “design Twitter” jokingly mocked up Figma’s app icon in Creative Cloud form - it was transparent to everyone that Figma would be part of Creative Cloud then why does the Figma CEO not report to the head of Creative Cloud? Internet meme about Figma being acquired by Adobe You may see him in every Adobe Max keynote talking about Creative Cloud products. Scott Belsky is the person in charge of Creative Cloud. Reading Figma’s CEO’s blog post announcement, after the acquisition, he will report to David Wadhwani, not Scott Belsky, which stands out as odd to me. Why does Adobe need Figma so badly? Organization chart oddity To reach such a deal, it must be Adobe begged to acquire Figma it was not a level field negotiation. $20 billion would be four times overpriced hence investors dropped the stock on the heel of the acquisition announcement. I think the actual value of Figma is around $5 billion. Figma is targeted to hit $400 million in revenue, assuming it has already hit the target revenue, multiple by a high multiplier of 10x - its valuation is at $4 billion. High-growth startups may have a high multiplier like 10x. Apply the same ratio to Figma, the Figma 2022 valuation is estimated to be $6.5 billion.Īnother way to peek at a startup’s valuation is by revenue and growth multiplier. Taking Canva, another contender in the design space, for example, its valuation declined from $40 billion in 2021 to $26 billion in 2022, despite that they are doing well. Except 2021 is at the peak of startup valuation, most startups cut their valuation by a lot in 2022, including those doing well. At first glance, it might make sense: Figma is doing so well that it doubled its valuation in a year of time between 20. We can try to estimate in two different ways:įigma last raised funds at a valuation of $10 billion in June 2021. Startup evaluation is complex, but there are shortcuts we can take to do a rough estimate. Why do other investors hate the acquisition, as shown by the stock price plunge? The simple answer is that the $20 billion price tag is too expensive. Not every investor of ADBE stock is like me, who held a grudge because they worked on the internal competitor product. One that I mentioned earlier - the blow in my wallet. One that I was once devoted to Adobe XD, spending days and nights trying to win the battle with Figma, but now the acquisition announces Adobe XD’s premature defeat. Prior to founding Typogram, I spent a year and a half working on Adobe XD and five years on another Adobe acquisition Typekit (now called Adobe Fonts). This newsletter series started on Aug 2nd, 2021, days after I left my position at the Adobe. A big portion of my net worth is held in ADBE stock, and that stock sunk 20% on a single day - the day they announced Adobe would acquire Figma for $20 billion. Over the years that I worked at Adobe, I bought into the ADBE stock through labor (RSU) and money (ESPP). Last week was eventful and, based on one’s stock portfolio, painful.
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