Figma's $20 Billion IPO Journey: From Adobe's Failed Takeover to Billionaire Status

Figma's IPO on Thursday minted a $1.8 billion fortune for its cofounder and CEO Dylan Field.

When staff at San Francisco-based design startup Figma returned from the Christmas holiday in January 2024, they were met with sobering news. A $20 billion takeover by Adobe, which had been stuck in 15 months of regulatory purgatory, had fallen apart amid antitrust concerns. In the wake of that news, cofounder and CEO Dylan Field pushed the reset button for the startup that aims to be the Google Docs for design. Figma slashed its internal valuation to just $10 billion and offered employees a voluntary exit package of three months’ severance. Only around 4% of the company’s 1,300 employees took the buyout.

The move, insiders and investors say, was meant to anchor the company and prepare it for the long-term future as an independent startup. “The net effect was that you had a lot of extremely motivated folks who have been working relentlessly to deliver new products,” says Figma investor Mamoon Hamid, a partner at venture capital firm Kleiner Perkins.

Nearly 18 months later, Field’s gamble paid off. Figma and its investors are set to raise $1.2 billion Thursday by selling shares to the public at a more than $19 billion valuation on a fully diluted basis (including options and other equity awards outstanding). The tech IPO will be among the five biggest in its sector this year.

One of the biggest winners of that listing is Field himself. At today’s IPO price, he is now worth an estimated $1.8 billion, but that may only be the first chapter of his payout. Over the next 10 years, the 33-year-old could unlock additional stock currently worth $1.3 billion at the IPO price (before taxes) between the compensation plans awarded to him in 2021 and 2025, if he remains with Figma and the company’s stock price quadruples to $130 per share (Adobe had offered him a similarly historic retention package). The structure reflects a trend of aggressive long-term incentive plans akin to Elon Musk’s $56 billion Tesla moonshot grant, which a Delaware court voided in January 2024 after ruling that the process underlying the award was not fair due to Musk’s control over the board (Musk has appealed the ruling).

Field might have taken Figma public but he still exercises a huge amount of control over the startup he cofounded in 2013. The terms of the initial public offering give Field the right to vote his cofounder Evan Wallace’s shares (worth nearly $900 million at the IPO price). Field and Wallace will own 99% of Figma’s Class B shares, which carry 15 times as many votes as the Class A shares held by other investors. All told, that gives Field, a Forbes 30 under 30 alum, control of around 74% of the company’s voting rights (including nearly 26% tied to his former Brown University classmate Wallace’s shares).

The listing marks a remarkable comeback for Figma from the collapse of its $20 billion takeover by Adobe in 2023. At the time, Adobe’s CEO Shantanu Narayen branded the deal as “transformational” for the publisher of Photoshop, Premiere Pro and Indesign. Adobe investors however balked at paying a sum that valued Figma at twice its last valuation and at around 50 times the startup’s $400 million of revenue. The deal was also met with concern by antitrust regulators in the United States, the United Kingdom and Europe–not to mention Figma fans, many of whom had bailed on Adobe’s own costly tools.

The acquisition, which was first announced in September 2022, was ultimately called off in late December 2023, after the British antitrust watchdog warned that the deal could reduce competition for design software. Adobe had to pay Figma a $1 billion breakup fee after the deal was cancelled but the company and its cofounder still faced a painful reset. “When you abandon a plan like the merger that’s a hard day but Dylan assessed and said: ‘That was that, here’s the new plan and let’s get going,’ says Figma investor John Lilly, a partner at venture capital firm Greylock. “It’s always a little scary when you offer to pay people to quit but not for Dylan and it was really healthy for the company.”

Figma’s team hadn’t been idle while its founder had been locked in talks with Adobe and regulators on both sides of the Atlantic. The company had earlier that summer launched a tool to help developers turn designs into code, and then over the last year has released a series of new design and AI tools.

That’s helped Figma to nearly double its revenue since the Adobe deal was first announced. Last year, Figma generated $749 million of revenue and its growth is accelerating, with the company reporting sales of $228.2 million for the first quarter of 2025, up 46% over the same period last year. Even so, Figma is not making money, yet. It posted a $732 million loss last year, largely driven by an $889 million stock grant to employees.

Figma still has a cult following and thousands of people flocked to the company’s annual Config meetup in San Francisco and London this year. Field, who dropped out of the computer science program at Brown University in 2012 to take a Thiel Fellowship, was the star speaker. Field and his Brown classmate Wallace worked on several business ideas like software for drones and a meme generator, before focusing on Adobe’s Photoshop editing tool. It would take years for the pair to launch the test version of Figma’s browser-based canvas but when it came out in 2015 it quickly became a hit with designers and insiders at big tech companies like Microsoft. That helped Figma catapult to a $10 billion valuation just six years after its first product launch making it one of the most closely tracked startups in Silicon Valley.

The IPO also marks a major windfall for some of Figma’s venture capital backers. A trio of blue chip venture firms – Index, Greylock and Kleiner Perkins – now hold nearly $6 billion worth of shares collectively, based on the listing price.

Index was named as Figma’s largest shareholder in its S-1 filing, translating to a stake worth around $2.1 billion at the IPO price, after Midas List investor Danny Rimer invested in Figma’s seed round when Field was just 19-years-old.

Sequoia Capital and Silicon Valley wealth manager Iconiq are also major winners from the initial public offering that could open the door to more companies going public after a long hiatus. A handful of initial public offerings like Coreweave’s $23 billion and Chime’s $12 billion listings, in addition to a flurry of takeovers, have helped break an unusual, and painful, drought of exits for venture capital investors.

Some of Figma’s major backers are now on track for a bumper year that goes beyond Figma. Index also stands to gain from Google’s $32 billion takeover of Wiz, Meta’s $14 billion Scale AI coup, and a buyout deal for Turkey’s $5 billion games developer Dream. Kleiner Perkins had chipmaker Ambiq list earlier this week on the New York Stock Exchange, and saw Google pay $2.4 billion for vibe coding startup Windsurf’s executives.

The same AI mania that has fueled some of this deal making also poses a threat to Figma. A crop of new startups like Lovable, Replit and StackBlitz have raised big rounds and seen revenues explode by using AI to turn simple written instructions into not the just type of prototypes and sketches that Figma is often used for but entire working websites and apps.