Figma Bags New Investment At $12.5B Valuation, Nearly 40% Lower Than The Terminated $20B Adobe Deal

Figma Inc., a San Francisco-based design startup, has secured a $12.5 billion valuation in a deal that involved investment from a group of prominent firms.

What Happened: The investment group includes Coatue Management, Alkeon Capital Management, and General Catalyst Partners, reported Bloomberg on Thursday citing people with knowledge of the matter.

This investment has come through a secondary share sale, which has been finalized. The deal also involved current and former employees, as well as other equity holders.

Figma, which is currently generating over $700 million in annual recurring revenue, is expected to exceed $1 billion by next year. The annual recurring revenue was approximately $400 million in late 2022.

Figma did not immediately respond to Benzinga's request for comment.

Other investors in this deal include Sequoia Capital, Andreessen Horowitz, Iconiq, SurgoCap Partners, Atlassian Corp., Fidelity Management & Research Co., Franklin Templeton’s Franklin Venture Partners, Thrive Capital, Greenoaks Capital Partners, Durable Capital Partners, Apple Inc. executive Eddy Cue, Goanna Capital, and XN, according to the Figma spokesperson.

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Why It Matters: This latest investment round comes after Figma set a $12.5 billion valuation in a new equity offering in May, which was notably lower than the $20 billion acquisition offer from Adobe Inc. ADBE.

The European Union raised antitrust concerns regarding the proposed acquisition, suggesting that it could significantly reduce competition in the global market for interactive product design tools. The EU’s investigation underscored worries about Figma’s potential dominance over Adobe’s Illustrator and Photoshop tools.

Adobe and Figma parted ways after failing to secure approvals from the European Commission and the UK Competition and Markets Authority.

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This story was generated using Benzinga Neuro and edited by Kaustubh Bagalkote