Adobe accession of Figma: A Big Deal

Adobe’s Figma acquisition is a $20 Bn bet to control the total creative market. Over the past several years, Figma has built its name as a forward-thinking and collaborative design platform and a formidable competitor to Adobe, the giant in the creative apps market.

However, that rivalry ended on Thursday when Adobe announced it had struck a $20 billion deal to acquire Figma.

The acquisition will allow Adobe to incorporate Figma’s popular design tools into its widely-used portfolio of creative apps. But the investment also means that Adobe will again be taking a significant competitor off the market and bringing it under its umbrella, to the dismay of many designers who rely on the tool and are wary of another critical platform joining the company’s Creative Cloud service.

And they have a point: with Figma off the market, the list of companies capable of challenging Adobe’s empire just got smaller. The Figma team will have “complete autonomy.”

Adobe says the current plan is essentially for nothing to change. “Acquisitions are only made well when they’re done uniquely based on the company and that you never follow a playbook,” Scott Belsky, Adobe’s chief product officer and EVP of Creative Cloud, said in an interview with The Verge. As a result, Belsky says the Figma team will have “complete autonomy.”

Figma’s independence is a point they have repeatedly been underscoring; a LinkedIn post from Belsky and a blog post from Figma CEO Dylan Field both mentioned that the plan is for Figma to continue operating autonomously. “The last thing anyone desires is to disrupt either one of our roadmaps,” Belsky said. No plans to bring Figma inside of Creative Cloud and no changes to Figma’s pricing, according to Belsky.

If anything, the earliest changes might be on Adobe’s side. According to Belsky, Adobe has been spiraling down its investment in Adobe XD, its competing design platform for things like apps and websites, and XD users could be encouraged to Figma in the future. “It was never because we didn’t think product design and development and this vertically integrated stack was a big opportunity,” he said.

In addition, Adobe has a “tiny team” supporting XD for its existing customers. “Once [the acquisition] closes, then we’ll figure out how to serve those customers, likely with Figma,” he said.

Field knows that they have to earn customers’ trust. “We must establish that trust for Adobe and Figma by being consistent over time around what we do, the actions we’re taking, and showing up for the community and doing what’s right here.”

Adobe has a history of buying up some of the essential tools in the creative space, acquiring companies like Frame.io, a video production collaboration tool, and Behance, which lets people showcase their creative work. The company has bought a lot of companies — even Photoshop was an acquisition. That makes the Figma purchase all the more concerning for designers; one of the few notable challengers to Adobe has been swept up, meaning Adobe will continue consolidating creative app power in one location.

The purchase isn’t necessarily an antitrust concern, but it could still be under regulators’ scrutiny. “It certainly looks like Adobe is in a dominant market position, and this acquisition would increase that dominance,” Matt Kent, a competition policy advocate for the consumer advocacy organization Public Citizen, said in an interview. But because Adobe is giant doesn’t necessarily mean that the merger violates the law.

Competing developers had mixed views on the acquisition. Alludo, which makes the Corel suite of tools, took a more positive tone. Adobe also acquired this when the regulatory bodies were getting more serious about cracking down on big tech mergers. For example, the Federal Trade Commission (FTC) filed to block Meta’s acquisition of the company behind VR fitness app Supernatural in July and sued to block Nvidia’s now-scrapped acquisition of Arm in November.