Adobe (NASDAQ: ADBE) today announced they are acquiring popular online design tool Figma for $20 billion (yes, you read that correctly) in order to bury it in the same mass grave alongside the bodies of Fireworks, Coldfusion, Flash, and others (I forgot they owned Magento). Of course, Adobe is saying this is a definitive merger agreement to acquire Figma which will (get this) “usher in a new era of collaborative creativity”.
A whole new era! What a time to be alive.
Strange, though – what has Adobe XD been doing since 2015? I guess that was the “old” era of collaborative creativity.
Anyway, they blither on in the press release:
Together, Adobe and Figma will reimagine the future of creativity and productivity, accelerate creativity on the web, advance product design and inspire global communities of creators, designers and developers. The combined company will have a massive, fast-growing market opportunity and capabilities to drive significant value for customers, shareholders and the industry.
Wow, some intern has quite the tuned checklist of words to include. We’ve got productivity, inspiration, value, and global massiveness. It’s honestly not even worth reading on because it’s all a honeyed mash of nonsense. There’s vibrancy, positivity, imagining, re-imagining, empowering…
But c’mon. Adobe is is buying Figma because its strategy in that space have been confused for years. Industry titan Adobe’s XD product is not nearly as popular and XD itself only existed because Adobe realized everyone was using another of their products (Sketch) to do design. I mean, even Microsoft uses Figma.
But now that check will go to Adobe instead. So what happens next for Figma and Adobe XD? There are a few different ways Adobe could go.
Option A would be to fire everyone who ever worked on XD. Why would you keep them? You just paid $20 billion for its chief competitor which is essentially a giant scream that your product didn’t work. So you nuke the XD team, and replace them with Figma. Figma will inevitably have to become another boxed-letter app in some suite with a $20/month price tag and a licensing daemon (I know it’s web-based, but Adobe will find a way to make the licensing complicated). But at least this way Figma will stay relevant for a while.
Of course, Adobe won’t do this, so Option B is let Figma whither and die. Slow down the innovations on Figma and really encourage people to give that spiffy XD product a try, with an endgame of announcing the end of Figma and a special deal for migration. The problem here is that if one group of entrepreneurs can start Figma today, another group can start Beefoop or Shizang or whatever tomorrow, and Adobe probably knows this or will pay a consultant who’ll tell them this.
So we’re on to Option C, which is taking these two teams and products and merging them. The Adobe dinosaurs who code in COBOL will clash with the young Javascript hipsters as management takes lean-and-mean Figma and Adobifies it. Onboarding an application into the Adobe ecosystem is analogous to dipping cotton candy in molasses. The end result will be a confused product and everyone will be using Beefoop or Shizang but you’ll have to wait 10 years for it. What will Adobe call the mess? It’s got to be one of their two-letter deals. They can’t make it FX (“Figma XD”) because that would confuse people with AfterEffects. XF perhaps? You heard it heard first. I also claim the obvious axing-Figma joke but will make it available on very reasonable licensing terms.
Here’s something fun to consider:
- By 2019, most of what Figma sells was available except FigJam. Sure, it’s nicer now than it was then, but I think it’s fair to say that in 2019, there were plenty of designers who were happily using Figma and paying for it and the basic value proposition was there.
- Through 2019, Figma had raised $83 million.
- In the last 12 months, Adobe has spent $2.7 billion on R&D.
So this vanguard company that is leading us all into a glorious future could have spent $83 million (and probably less, leveraging their internal resources) to build Figma. That’s 3% of their annual spend, or less than they spend in two weeks. Instead, they are now paying $20 billion.
Shares are only off 17% on the news.
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I enjoy writing technical articles here on LowEndBox to help people get more out of their systems. You can find me on LowEndTalk @raindog308
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