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Figma and Adobe abandon proposed merger

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Re: Figma and Adobe abandon proposed merger

#731

Post by amrocha »

hn_throwaway_99 wrote: post #631
endtime wrote: post #578

Earlier quoted context omitted.

> that the purpose of building a business is just the exit The majority of those affected negatively by this are not the founders, but the employees. Many of them may have turned down FAANG positions that come with predictable liquid RSUs. Some may have kids (in fact, I know someone at Figma who had a kid in the past year). Liquidity's not necessarily about opportunistically passing on risk...sometimes it's just abou…

I don't disagree with what you're saying, at all, but the implication is still basically "And employees want someone else to be a bag holder, too!" And having been in that position several times, I definitely don't blame them! Employees also have the much tougher constraints that they can't diversify their employment like VCs can diversify their investments. But still, it's the same dynamic that people want to get ri…

In practice, employee shares in a private company are not an "investment" because they can't be traded in an open market. So no, employees don't want someone else to hold the bag. Employees want a return on their investment, and the most viable way of doing that is through an exit.

Re: Figma and Adobe abandon proposed merger

#732

Post by dcchambers »

I don't use Figma or Adobe tools so I don't really know or care about this acquisition. It seems like public opinion is split - some saw this as a good thing and others as a bad thing for Figma.

Who I really feel bad for is some of the early employees that just saw life-changing amounts of money vanish in the blink of an eye.

I can't imagine how gutted they must be headed into the Holidays. Obviously that value isn't truly gone - but it certainly changes things, and I am sure many of them did not plan for this.

Re: Figma and Adobe abandon proposed merger

#733

Post by fauigerzigerk »

ThomPete wrote: post #660
fauigerzigerk wrote: post #610

Earlier quoted context omitted.

Depending on how exactly you segment the market, Adobe's market share is somewhere between 33% and 75%. The runner-up is in the single digits. In my view, the case for blocking this acquisition couldn't be any clearer. If Adobe wants to grow in this space, it should make better software or cut prices or both.

You have to segment it into the verticals. Canva is 5 times bigger if not more than Adobe Express which is the equivalent. Substance is miniscule in the 3d market compared to Max, Softimage, Maya etc. Adobe is big because of the many vertical they are in, not because they own them.

This is a well rehearsed segmentation game that market leaders like to play until even the biggest companies on earth no longer appear to be dominant in any specific segment.

I don't buy it. It's not just about indvidual verticals in their current state. For these conglomerates it's always about buying rising competitors out of the market before they can become a strategic threat.

Figma could have expanded beyond any particular vertical they are currently in. Figma could have been bought buy a stronger competitor from outside the graphics space (such as Microsoft). Adobe didn't want to let that happen.

We should block all of these defensive acquisitions. And we should block all acquisitions that help an already big conglomerate capture the next neighboring vertical without doing any actual engineering work (except for small acqui-hires perhaps)

Re: Figma and Adobe abandon proposed merger

#734

Post by sackfield »

sowbug wrote: post #196
codeptualize wrote: post #126

That is wild. It's a good thing as it means Adobe won't ruin Figma like they did with so many great software products before, but just imagine founders, investors and employees, thinking they had a really good exit.. That must hurt, I hope they can stay motivated. If Adobe can't buy them, what other exit options do they have? Go public?

What's wrong with selling goods and services for more than they cost?

The employees are sold shares in the business that they expect to accrue a certain amount of value and with scale get very serious multiples in a liquidity event. With that promise broken the value proposition they originally signed up for no longer holds, some perhaps wasted the best years of their lives here when other options were on the table. If all you want to do is sell goods and services for more than they cost, then open up a bakery.

Re: Figma and Adobe abandon proposed merger

#735

Post by ksec »

tsycho wrote: post #549

[Pure speculation; I don't work in the UI space at all, and at neither of these companies] I wonder if Adobe is secretly happy about this. They were acquiring Figma at the peak of the market (for growth stock/startup valuations) because of the existential risks that Figma was threatening, due to their collaborative development UX. But since then: * Startup valuations have fallen. Ignoring regulatory concerns, a new a…

>* Startup valuations have fallen. Ignoring regulatory concerns, a new acquisition deal today would be cheaper.

Figma reached $400M in 2022 and on its way to hit $600M this year 2023. For perspective they reached $200M in 2021, and $75M in 2020. That is pretty impressive growth rate.

Straightly on a revenue / market cap, Adobe makes $20B Revenue and values at $270B. That is 13.5x multiple. If we expect Figma to hit $1B mark by 2025, they could be worth $13.5B. i.e Even with today's market, I dont think it is hard to do an IPO with that $13.5B valuation.

And if Adobe were to acquire a listed company with 30% premium, that is $17.5B. Not that far off from $20B. Now that Figma has an extra $1B cash flow, I hope they spend it wisely and continue to do well. So while some may argue this is bad for employees and investors. I dont think it is that bad.

I do hope they consider IPO, as I am slightly worried the window of opportunity may be gone when market turns.

Re: Figma and Adobe abandon proposed merger

#736

Post by remoquete »

doctorpangloss wrote: post #676
aliston wrote: post #666

Earlier quoted context omitted.

What's so bad about the Spotify app? For the most part, it looks like a bunch of lists (not so much spreadsheets) to me... As someone that is only tangentially in the design space, why do you think collaborative design works so poorly? I have noticed that, in engineering reviews, complex backend designs get scrutiny, but rarely "I feel..", "I prefer..." types of comments, whereas frontend teams get all types of those…

This is a stylized comment. It is a bunch of lists, but the UI is sometimes the lists are scrolling horizontally album covers, sometimes they are popping up from menu buttons, sometimes they go full screen and scroll normally, sometimes they are cut short to 5 elements and you cannot see more, sometimes they continue to 20 elements and you can press to see more, sometimes it's a list with headers that all contain mor…

As a UX writer, the ability of providing feedback or editing UI text before a disastrous piece of Loren Ipsum goes to production is very, very valuable. What's the feedback you think is silly here?

Re: Figma and Adobe abandon proposed merger

#737

Post by rchaud »

toyg wrote: post #721
rchaud wrote: post #371

Earlier quoted context omitted.

> it means the underlying product is not good enough to stand on it's own feet. Adobe CC not strong enough? That's not it. Subscription retention practices like this are to juice quarterly numbers to delight analysts on the earnings calls. If Adobe was a private company this level of lock-in desperation wouldn't be necessary. We'd still be able to buy the software once like we used to.

That's a hopeful statement. Maybe it wouldn't be necessary, but it would be implemented anyway. These days, any company not having subscriptions is seen as leaving money on the table and they will become targets for takeovers.

> These days, any company not having subscriptions is seen as leaving money on the table

This kind of product economics comes from Wall Street. It's led to a world where companies, rather than charging at a stable price point that allows them to keep the lights on, offer something at an unsustainable $10/mo to build marketshare. Then they raise the price every year after that, whether or not the additions made have any added value.

Re: Figma and Adobe abandon proposed merger

#738

Post by eurekin »

echelon wrote: post #600
eurekin wrote: post #294

Adobe acts like a proper "wealth manager" and not a creative company - good for Figma!

Or they could see the competitive landscape for creativity changing fast and view that Figma's product is an evolutionary dead end. They might see a Gen AI approach to Figma that will kill Figma in 5 years.

Well, they could use the figma to actually develop that AI; users, documents and etc.

Re: Figma and Adobe abandon proposed merger

#739

Post by hn_throwaway_99 »

amrocha wrote: post #731
hn_throwaway_99 wrote: post #631

Earlier quoted context omitted.

I don't disagree with what you're saying, at all, but the implication is still basically "And employees want someone else to be a bag holder, too!" And having been in that position several times, I definitely don't blame them! Employees also have the much tougher constraints that they can't diversify their employment like VCs can diversify their investments. But still, it's the same dynamic that people want to get ri…

In practice, employee shares in a private company are not an "investment" because they can't be traded in an open market. So no, employees don't want someone else to hold the bag. Employees want a return on their investment, and the most viable way of doing that is through an exit.

That's the whole point though - employees want an exit event so they can sell their shares and have someone else holding the bag.

Re: Figma and Adobe abandon proposed merger

#740

Post by pier25 »

FredPret wrote: post #723
pier25 wrote: post #385

Earlier quoted context omitted.

For photo editing, PixelMator Pro and Affinity Photo are great.

I'll check these out. Both have one-time payments through the App Store, which is about 1000x better than an opaque, eternal, very expensive subscription with Adobe. I'm a very non-serious amateur; all I do is edit the light curves in my photos or do some light cropping. The built-in editor in Apple Finder is amazing for that!

I think the latest version of Affinity is not available through the AppStore though.

https://affinity.serif.com/

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