Figma IPO
Hi,
I’m a software engineer who uses Figma on a daily basis, and I’m really interested in learning more about the company.
I was wondering if you could share your perspective on why Figma’s stock was so underpriced, given that the market willingness to pay significantly more. It seems like the company missed out on billions. I also don't know why it wasn't valued more since the Adobe deal.
I’d also love to hear your thoughts on the company’s current financial position and future outlook.
I think the short answer is that banks price strongly based off comps and it would be ludicrous to underwrite +50% higher than the set of comps without some real major driver (more than just oh we have AI figma now haha)
I also don’t believe the valuation it’s floating at is justified long-term, it’s basically close to the same value of Palantir, but we have to remember that there has been a *long big tech IPO drought, especially with all the unicorn darlings of the 2010s era, so Figma is kicking off a party and riding that way so to speak. These are just my uneducated hunches though. Figma on paper is a great company financially, I just don’t think it’s multiple premium is that justified in the long run, so expect it to correctly especially after the lock up period
Interesting. Among tech companies, I believe Figma deserves an extra premium — they have a defensible moat (with nearly all UI work relying on it today, and it being deeply ingrained in the product development lifecycle, I find it unlikely any tool will replace it), strong talent, a highly scalable product, significant potential for AI integration, minimal physical expenditure, and an excellent industry reputation. By contrast, Palantir’s model appears less scalable, and the company struggles with a poor reputation.
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