Figma Prices IPO almost 3 Years After Failed Adobe Acquisition

Congratulations to Figma's investors and current/former employees on the upcoming IPO!

For those who don’t know, Figma is a collaborative cloud-based design platform for teams to create, prototype, and share interfaces in real time. It provides a robust set of vector graphics editing and prototyping tools, making it a central hub for designers, developers, and other stakeholders to work together on digital product design.

This is Figma’s second attempt at a liquidity event. In 2022, Adobe attempted to buy the company for $20B, but the acquisition failed due to anti-trust laws. Now, almost 3 years later, Figma is aiming for an $19.3B valuation in its upcoming IPO.

Let’s take a look at what investors and employees stand to make from this IPO. Please note that we will be using the initial IPO price for Figma at $33. Most employees/investors will have a 6-month lockup period, so their actual returns may vary depending on how the market views the company and how long they wait to sell.

Below is a graph of Figma’s stock price over time. We didn’t include any of the rounds before 2018 because the pricing was so low we can assume they all had great returns. We also estimated the failed M&A price by Adobe based on the $20B reported valuation. Lastly, for those unaware when looking at the graph, a tender offer is a formal offer by an investor (often a new or existing institutional investor) or the company itself to purchase shares directly from existing shareholders such as earlier investors or employees.

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How did the Investors do?

As you can see the Series B-D investors all did great. Ranging from an 99x to a 7x for the 2020 Series D, which handedly beats the S&P 500 which boast a 2.16x in that same time.

The Series E investors, which put money in during peak valuations, did not fare so well. They are getting about a 1.55x over 4 years, still beating the S&P which had a 1.49x return in that same time period.

Even though the deal never closed, it’s notable that Adobe’s offer remains higher than Figma’s IPO price nearly three years later.

Investors who participated in the most recent Tender offer achieved solid returns, beating the S&P 500 with a 1.42x return compared to the S&P's 1.18x. At the time, this was likely seen as a safe bet, especially since it was priced at a discount to the failed Adobe M&A.

Common Stock: How did the Employees do?

Unfortunately, Figma's S-1 only contained one exercise price for employees, and that was the $23.19 Tender price, which we’ve already analyzed. We do know however that in 2022 the average price of exercised shares was $0.19. We don’t know when or how many employees were given this price, but that would net a return of almost 174x, not too shabby at all.

In 2024 this average price of exercise jumped to $10.18. This is still a very respectable return of a 3.24x.

It’s probably a fair assumption to say that the majority of employees who exercised and held onto their equity at Figma have received a very nice return on their stock options.

Pre-IPO Sales

One thing to consider here is that many employees likely sold during the 2024 Tender Offer. After almost being acquired by Adobe for $20B in September 2022, employees likely got excited about the prospects of a great exit. The acquisition then underwent heavy regulatory scrutiny, due to antitrust concerns, that lasted until December 2023, when the two companies mutually agreed to call off the deal.

Ultimately, for employees, this highly anticipated exit never materialized, likely leaving many with a sense of missing out. Fast forward about 6 months, and Figma offered its employees a Tender Price of $23.19, which we estimate to be about two thirds of the price they would have received from Adobe (confirmed by news stories showing the tender was priced at $12.5B).

This tender offer, according to the company, was sized above $600M, meaning many employees cashed in during this opportunity. Overall, they still had great outcomes, but pending Figma’s price movement over the upcoming 6 month lockup, they may have left some money on the table.

This does highlight a potential downside of selling pre-IPO, but you can’t always guarantee that pre-IPO secondary or tender buyers will make money and there is value in taking the bird in hand when presented an opportunity to sell. This situation is particularly interesting however, given order of events for Figma employees: Adobe pump fake at $20B → Tender Offer at $12.5B → IPO at $19.3B.

At the end of the day, employees came out great whether they sold in the Tender or waited for the IPO.

Key Takeaways:

1. Adobe's perspective: From a purely valuation standpoint, Adobe is likely content that the acquisition did not materialize. It appears Adobe sought to acquire Figma at the market's peak. Despite Figma being a strong company, it's remarkable that its IPO price three years later remains lower than the proposed acquisition price.
2. We’ve had two major IPOs this year (Circle & Coreweave) where the stock price has taken off when public investors have had a chance to buy in. Will be interesting to see if the same happens to Figma, or if it will be a more reserved IPO. Despite Circle & Coreweave's post-IPO success, much of their gains are predicated on hot AI and crypto markets. It is possible that companies like Databricks, Stripe, Canva and others view Figma as one of the first "strong" IPOs based on the company's fundamentals. A positive reception of Figma's shares on the public markets could go a long way towards us seeing more large VC backed debuts.
3. Everyone who actually invested is in the money. All the VCs who put in cash in the different rounds are up. For an IPO company this may seem like an obvious outcome, however there are a couple companies who went public this past year where the investors in the later rounds actually came out losing money. This goes to show the strength Figma has had in continuing to grow, even when they were valued at high multiples a couple of years ago.
4. Those who sold in the Tender Offer did well, but may regret that decision today. That being said, there is still a 6 month lockup, so we will see how things look in early 2026 when the employees who waited for the IPO are finally able to cash in. Sometimes pre-IPO is the best time to sell, other times, holding wins. Ultimately, taking the sure thing and reinvesting it can potentially make up some of the difference in pricing as well.

Update as of 7.31.2025: Figma's first day of trading closed at an incredible $115.50. This is over three times the initial IPO price. Will be fun to see what the final price is in 6 months after the lockup is over.

Written by Sam Stroud, Investor at ESO Fund