Adobe is buying Figma for $20 billion – but not everyone thinks that’s a good idea
>
Adobe has announced its intention to buy online collaboration tool Figma for $20 billion.
The half-cash/half-stock deal, yet to be finalized, is a bold move from the company behind leading creative apps Photoshop and Premiere Pro — and will be Adobe’s largest acquisition to date.
But the shock announcement saw the company’s stock plummet, with investors seemingly punishing the company for its high price tag.
Adobe vs Figma
It appears the size of the deal has led investors to lower Adobe’s stock to its lowest level in nearly three years. Market overview (opens in new tab) reported.
The Figma deal isn’t the only problem Adobe is currently facing. Despite hitting record revenues of $4.43 billion in third quarter 2022 financial results, investors were disappointed with the company’s subdued outlook for the next quarter.
But the company remains optimistic about the acquisition.
“Adobe’s greatness is rooted in our ability to create new categories and deliver cutting-edge technologies through organic innovation and inorganic acquisitions. The combination of Adobe and Figma is transformational and will accelerate our vision for collaborative creativity,” said Chairman and CEO Shantanu Narayen.
Founded in 2012, Figma has become one of the best interface design tools in its field. By putting into practice what they preached, the developers made it easy to use (and, for now at least, it offers a free plan). Built for collaboration online, the cloud-powered, browser-based prototyping proved popular with firmly digitally-minded UX professionals and students.
Indie software developer Nathan Manousos noted (opens in new tab) that Adobe acquisition “shows how difficult it is to turn money into software. You’d think you could build something as good as Figma for $20 billion yourself, but you can’t. Software is art.”
Adobe XD was the closest the San Jose giant could come to a Figma alternative. But many found it less accessible, limited – it only runs on Windows and Mac – and less suitable for team collaboration. That it suffers from Adobe’s well-known complaint of lack of regular QoL updates didn’t help endear it to users.
For a company the size of Adobe, it’s much easier to just add Figma to its own industry-standard stable video editing software and photo editors. With its collaborative design, the industry-leading design tool fits neatly into the Creative cloud ecosphere.
If you can’t beat them, buy them.
Whether that’s the right decision – for Adobe, Figma and their users – is unclear.
The minds behind Sketch, UXPin and mockup software rivals may look at the merger with envy. And maybe hide a grin at Adobe’s declining stock.
But few will publicly repeat Ricardo Cabello, developer of open source 3D design library Three.js, who responded to the news with a Tweet (opens in new tab) which simply read, “Sold Out.”