Figma Shares Rise Sharply After IPO

Shares in online design firm Figma nearly quadrupled late last week following its initial public offering on the New York Stock Exchange on Thursday, valuing the company at nearly $60 billion (£45bn), in the latest successful tech IPO this year after a multi-year lull.

The company, which makes web-based software that can be used to collaboratively develop app and website interfaces, agreed to be bought by Adobe in 2022 for $20bn, but the deal fell apart the following year over regulators’ competition concerns.

Two weeks ago, Figma said it would price its shares at $25 to $28 each, then raised the figure to $30 to $32 and finally priced the shares at $33 on last Wednesday.

Collaborative design

On Thursday, their first day of trading, the shares rose about 250 percent and closed another 5 percent up on Friday at just over $121.

The company’s largest venture-capital backer, Index Ventures, invested an initial $100m into Figma when it was a start-up raising seed funding, and saw its stake rise in value to roughly $7.23bn as of Thursday’s close, Bloomberg estimated. That value could change as the stock’s price fluctuates.

Greylock Partners’ $50m investment in Figma’s Series A funding round in 2015 rose to a value of $6.75bn on Thursday, Bloomberg estimated.

Figma revenue rose 46 percent in the first quarter of this year, while net income grew threefold, the company said in a regulatory filing ahead of the IPO.

The figures implied year-on-year revenue growth of between 39 percent and 41 percent.

In its earlier filing Figma disclosed an investment in Bitwise’s Bitcoin exchange-traded fund and said it plans to allocate another $30m to Bitcoin investments.

IPO success

The market for public offerings has remained in the doldrums since early 2022, at a time of soaring inflation and rising interest rates, when investors had little appetite for speculative ventures.

But this year, online bank Chime, stablecoin firm Circle and artificial intelligence infrastructure provider CoreWeave have all carried out successful tech offerings.

Circle, which offers a stablecoin, remains more than 440 percent up since its June offering, benefiting from a White House policy favourable to cryptocurrencies and new US stablecoin regulations that were signed into law last month.