Adobe’s acquisition of Figma is a $20 billion gamble to control the entire creative market

Over the past few years, Figma has made a name for itself as a cutting-edge, collaborative design platform and a formidable competitor to Adobe, the giant in the creative apps market. That rivalry ended on Thursday when Adobe announced it had reached a $20 billion deal to acquire Figma.

The acquisition will allow Adobe to integrate Figma’s popular design tools into its widely used portfolio of creative apps. But the acquisition also means Adobe will once again take a major competitor out of the market and place it under its own umbrella, much 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’re right: with Figma out of the market, the list of companies capable of challenging Adobe’s empire has just shrunk considerably.

The Figma team will have “complete autonomy”

Adobe says the current plan is essentially to change nothing. “I think acquisitions are only done right when they’re done purely on the business and you never follow a playbook,” said Scott Belsky, chief product officer of Adobe and executive vice president of Creative. Cloud, in an interview with The edge. Belsky says the Figma team will have “complete autonomy.”

Figma’s independence is a point they have repeatedly emphasized; a LinkedIn post from Belsky and a blog post from Figma CEO Dylan Field both mentioned that the plan was for Figma to continue operating on its own. “The last thing anyone wants is to disrupt any of our roadmaps,” Belsky said. This means there are no plans to integrate Figma into Creative Cloud and there are no changes to Figma pricing, according to Belsky.

If anything, the first changes could be on Adobe’s side. Adobe has ended its investment in Adobe XD, its competing design platform for things like apps and websites, and XD users may be pushed to Figma in the future, Belsky said. “It was never because we didn’t think product design and development and this vertically integrated stack was a big opportunity,” he said. Currently, Adobe has a “small team” supporting XD for existing customers. “Once [the acquisition] closes, then we’ll figure out how to serve those customers, probably with Figma,” he said.

Field knows he has to earn the trust of customers. “We need to build that trust for Adobe and for Figma by being really consistent over time around what we do, the actions we take, and showing up for the community and doing the right thing here.”

A screenshot of Figma's new dark mode against a starry background.

Figma’s recently added dark mode.
Image: Figma

Adobe has a history of buying some of the biggest tools in the creative space, acquiring companies like Frame.io, a video production collaboration tool, and Behance, which lets people showcase their creative work. (Belsky first joined Adobe through this acquisition.) The company bought a lot companies – even Photoshop was an acquisition. This makes buying Figma all the more concerning for designers; one of Adobe’s few notable challengers has been swept aside, meaning Adobe will continue to consolidate the power of creative apps in one place.

The purchase isn’t necessarily an antitrust issue, but it could still come under scrutiny from regulators. “It does appear that Adobe has a dominant position in the market, and this acquisition would reinforce that dominance,” Matt Kent, competition policy advocate for consumer advocacy organization Public Citizen, said in an interview. But just because Adobe is big doesn’t necessarily mean the merger violates the law, he said.

“Any developers in this community acquired by Adobe will likely be snuffed out”

Competing developers had mixed opinions on the acquisition. Affinity, which offers its own suite of creative software, believes the acquisition could reduce innovation in the creative apps space. “Any developers in this community acquired by Adobe will likely be stifled as their goals are realigned with what is good for Adobe. Ultimately, this can only narrow the choice available for creatives,” Ashley Hewson, general manager of developer Affinity Serif, said in an emailed statement.

Alludo, which makes the Corel suite of tools, took on a more positive tone. “While we have no specific comment on current Adobe news, this decision definitely validates what we have believed for many years now: collaboration tools are essential in the design world,” Prashant Ketkar, CTO and CPO of Alludo, said in an emailed statement. “We expect this movement to only grow.”

Adobe is also making the acquisition at a time when regulators are increasingly taking crackdowns on big tech mergers seriously. The Federal Trade Commission (FTC) has filed a request to block Meta’s acquisition of the company behind the VR fitness app Supernatural in July, for example, and filed a lawsuit to block Nvidia’s now-discontinued acquisition of Arm in November. FTC spokeswoman Betsy Lordan said the FTC is not commenting on the proposed transactions, and Justice Department spokeswoman Arlen Morales declined to comment.

The acquisition of Figma is expected to close in 2023 and will need to pass regulatory review before doing so. If that happens, both companies will have a lot to prove. In January 2021, Field tweeted that “our goal is to be Figma and not Adobe”, and I asked him what he thought of this tweet now that he will soon be part of Adobe. “I still stand by this tweet, and not because I have reservations about Adobe,” he said. “We are very focused, throughout all of our conversations on this acquisition, on [the] Figma’s autonomy.

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