Figma rising inside Microsoft, testing longtime take care of Adobe


Microsoft and Adobe have been pleasant bedfellows for many years. Microsoft’s dominant PC working system has been the gateway for Adobe to succeed in hundreds of thousands of enterprise customers with its design software program.

The businesses’ CEOs even attended the identical highschool in India, and each moved to the U.S. within the Nineteen Eighties for graduate faculty in laptop science. They share a typical bond over the profitable transition from desktop software program to the cloud.

However inside Microsoft, an rising problem to Adobe is catching fireplace and elevating questions on the way forward for one of many tech trade’s most intimate relationships.

Figma, a San Francisco-based startup that celebrated its tenth anniversary in August, is being utilized by tens of 1000’s of workers inside Microsoft and, for a lot of, is on the coronary heart of their every day work. The variety of customers has steadily elevated in recent times, although neither firm will say what number of of them are editors with paid accounts.

The cloud-based design software program got here within the door in 2016, when Microsoft acquired cellular app growth platform Xamarin and introduced in a 350-person staff that, months after the deal closed, would turn into Figma energy customers. The product has since turn into so central to how Microsoft’s designers do their jobs that Jon Friedman, company vice chairman of design and analysis, mentioned Figma is “like air and water for us.” It is also utilized by engineers, entrepreneurs and knowledge scientists throughout Microsoft.

“Figma’s turn into, I might say, type of the No. 1 widespread software we use to collaborate throughout all the design group in the neighborhood and past,” mentioned Friedman, who’s labored at Microsoft for over 18 years. It is “actually nice at serving to us collaborate at scale, and at international scale. I can collaborate with groups we’ve in India, China, Europe, Israel and Africa.”

Enterprise buyers have been all in on the expansion.

In June 2021, through the heyday of mega financings, Figma was valued at $10 billion in a funding spherical that included participation from Morgan Stanley’s Counterpoint World. That was earlier than the 2022 market plunge despatched many cloud shares down by greater than half and largely halted pre-IPO rounds.

Figma hasn’t introduced plans for a inventory market debut, and shareholders aren’t urgent for one anytime quickly, largely as a result of the marketplace for new choices has dried up this yr.

The corporate, backed by the likes of Index Ventures, Greylock Companions and Kleiner Perkins, now has the scale and development trajectory to land solidly on the radar of public buyers. Annualized recurring income has greater than doubled in consecutive years and is poised to prime $400 million in 2022, in keeping with individuals with information of the corporate’s financials who requested to not be named as a result of the numbers are confidential. Figma’s workforce has swelled to 800.

Whereas Microsoft has served as a development driver for Figma, spending hundreds of thousands a yr on its deployment, the corporate’s software program has additionally taken off at Google, Oracle and Salesforce, the place it began small and grew organically as followers touted it to their colleagues. Different clients embody Airbnb, Dropbox, Herman Miller, Stripe and Twitter.

After Figma founder and CEO Dylan Area tweeted earlier this month in regards to the firm turning 10 years previous, he obtained flattering responses from Salesforce co-CEO Bret Taylor and Atlassian co-CEO Mike Cannon-Brookes. Taylor began his response with, “I [heart emoji] Figma.”

For Figma, getting traction inside large firms, notably inside Microsoft, has required going head-to-head with Adobe’s competing XD program, and successful its fair proportion of offers. That does not imply the market has fully flipped, or that Adobe is being absolutely supplanted.

“We’re nonetheless heavy on Adobe Illustrator, Photoshop and XD,” Friedman mentioned.

Adobe and Microsoft have labored collectively for greater than twenty years. Along with Adobe gaining ubiquity by distributing throughout Home windows machines, the 2 firms have been syncing their merchandise in desktop, cloud and cellular computing, with over 50 integrations listed on Microsoft’s web site.

Penetrating that alliance has not at all times been easy for Figma. In 2016, Microsoft acquired Dawn, a startup with a well-liked calendar app. The Dawn staff relied on Figma and continued to make use of it after the deal closed.

Dawn co-founder Jeremy Le Van mentioned his workers have been among the many fortunate ones at Microsoft. He mentioned some Microsoft staffers weren’t in a position to make use of Figma due to the enterprise relationship with Adobe and have been caught utilizing merchandise reminiscent of Photoshop and XD. Regardless of government resistance in sure departments, some designers snuck out of the Adobe ecosystem to make use of Figma anyway, mentioned Le Van, who stayed on as a design director at Microsoft till 2018.

Friedman mentioned he wasn’t conscious of examples of Figma being shut out. “We’ve an amazing relationship with Adobe as properly and love their merchandise for a lot of use circumstances at Microsoft,” he mentioned.

The identical yr of the Dawn deal, Adobe mentioned it could make Microsoft’s Azure its most popular cloud for Inventive Cloud, in addition to the Advertising Cloud and Doc Cloud. To mark the event, Microsoft CEO Satya Nadella and Adobe CEO Shantanu Narayen, who each went to highschool at India’s Hyderabad Public Faculty, appeared at Microsoft’s Ignite convention for IT professionals underneath a banner declaring that Adobe loves Azure.

‘We each needed it’

Figma’s collaborative capabilities are central to its reputation. A number of editors of a doc can see each other working in actual time, and non-editors can view designs and depart feedback. Corporations pay for Figma primarily based on the variety of editors they’ve for his or her recordsdata.

“Any designer, product supervisor or engineer can leap in and see the design system at play in any explicit product,” Friedman mentioned.

Final week, Figma launched a model of its service that individuals can use in Microsoft’s Groups communication app, eradicating the necessity to open a browser tab.

“We each needed it,” mentioned Area, who began Figma after scoring a Thiel Fellowship, which got here with a $100,000 grant from enterprise investor Peter Thiel on the situation that he drop out of school (Brown College) and pursue a brand new mission.

The Groups integration is a software that advantages any person of Microsoft merchandise, not simply workers. Adobe, which presents Groups apps for Acrobat and Inventive Cloud, is aware of all in regards to the energy of tying into the Microsoft ecosystem. It has been an enormous a part of the corporate’s success in its 40-year run as much as nearly $17 billion in annual income.

Figma needed to begin small. Like many organizations, Microsoft started utilizing it totally free. At this time, a buyer will pay Figma every month primarily based on the quantity of people that make adjustments to recordsdata, whereas a extra restricted model of the service is offered without charge.

In 2017, a yr after the Xamarin acquisition, Area hosted Friedman at his firm’s San Francisco headquarters. Area says he remembers asking Friedman why Microsoft did not wish to maintain utilizing the free model of Figma.

“‘Look, we’re all frightened you are going to die as an organization,” Area recalled Friedman telling him. “We will not unfold it inside Microsoft as an organization though we prefer it, since you’re not charging.”

It wasn’t nearly conserving Figma alive. As a big-spending buyer, Microsoft was in place to start out asking for extra options.

A workspace inside Constructing 21 on the Microsoft campus in Redmond, Washington, on March 3, 2022. Microsoft Corp. has begun calling workers again to its headquarters in latest weeks, however its return-to-office technique hinges on hybrid work.

Chona Kasinger | Bloomberg | Getty Photographs

Area mentioned Microsoft’s suggestions led to a number of enhancements. For instance, Figma engineers labored to make it simpler to maneuver from display to display in a single Figma file. The corporate additionally added assist for enter from Xbox recreation controllers and made prototype previews work sooner on cellular gadgets.

In the end, Microsoft’s requests helped Figma develop its top-tier enterprise plan, Area mentioned, including to the free model and paid month-to-month premium packages that vary from $12 to $45 per editor per 30 days. The enterprise package deal runs at $75 per editor and consists of devoted account managers and superior password administration.

Václav Vančura remembers when issues have been very totally different.

Vančura was a senior designer at Xamarin, whose software program helped firms construct Android and iOS apps with Microsoft’s C# programming language.

When Figma introduced its launch in late 2015, Vančura was impressed with the corporate’s thought for shared design part libraries. He signed up for a preview launch and obtained entry in the summertime of 2016. He inspired his colleagues to leap on board, beginning with David Siegel, Xamarin’s head of design.

Vančura and Siegel encountered snags whereas sharing recordsdata from design competitor Sketch. After one Xamarin worker uploaded a file to a Dropbox folder, their teammates generally struggled to get it working on their computer systems, both as a result of they did not have the suitable fonts put in or as a result of they’d totally different variations of the software program.

In contrast to Sketch, which was solely out there on MacOS, Figma was on the browser. That meant fewer sharing points. You grant others entry by copying a hyperlink or getting into their electronic mail addresses, similar to in Google Docs. However efficiency was an issue.

Vančura made advanced designs in Figma, inflicting the software program to decelerate, freeze and crash. The Xamarin staff despatched Vančura’s recordsdata to Figma engineers, who made Figma speedier and extra steady.

In 2017, Vančura flew from the Czech Republic, the place he lives, to Seattle, after which made the brief trek to Microsoft’s headquarters in Redmond. He took the chance to indicate Figma to his staff, lots of whom have been accustomed to working in Photoshop and Illustrator.

“It was superb. It was like watching Method 1,” Vančura mentioned. “There have been so many mouse tips about the display, and everyone designed one thing, even when it meant they have been pasting GIFs or drawing rectangles. All of them have been so blown away. I believe that was the second these individuals discovered this was an enormous time saver.”

Gaining traction

Siegel, who had turn into Microsoft’s head of design for developer providers, needed to get the phrase out extra broadly that Microsoft was evolving and wasn’t caught to its previous remoted methods. In 2018, he posted a manifesto of kinds on-line.

“We use PCs, Macs, Figma, Sketch, GitHub, JavaScript, ZEIT, and different fashionable instruments to design, prototype, and construct the way forward for software program growth,” Siegel wrote on Xamarin’s web site. There was a hyperlink to a Figma file that Microsoft workers may open.

The web site reached the entrance web page of Hacker Information, a dialogue board for software program builders.

“That is some unimaginable self-awareness,” one commenter wrote.

Quickly after, Benedikt Lehnert, a Microsoft product design director, informed Friedman that the corporate wanted everybody on the identical program, whether or not it was Figma or XD. Microsoft selected Figma, Lehnert mentioned.

Scott Belsky, chief product officer and government vice chairman for Inventive Cloud at Adobe after which a enterprise associate at Benchmark, speaks onstage on the TechCrunch Disrupt convention in San Francisco on Sept. 13, 2016.

Steve Jennings | TechCrunch | Getty Photographs

Vančura mentioned that at Microsoft, “Figma unfold throughout the corporate so quick that I do not suppose Adobe was even capable of catch up.”

Figma is not shy about going up towards an trade heavyweight. On its web site, Figma says, “Don’t sync to the cloud with Adobe XD. Work within the cloud with Figma.” It asserts that designers are shifting away from Adobe’s Inventive Cloud bundle, the product that accounts for 59% of Adobe’s income.

in 2020, Adobe added Figma to the checklist of opponents it publishes in its annual report.

Analysts have raised questions on Figma to Adobe executives on no less than three events this yr. Alex Zukin of Wolfe Analysis requested throughout a January hearth chat with Adobe executives Scott Belsky and David Wadhwani if Figma was taking market share.

Belsky, Adobe’s product chief and government vice chairman for Inventive Cloud, did not reply the query immediately. However he acknowledged that enterprise capitalists have been funneling cash into the area.

“It is thrilling that VCs see the similar factor we’re seeing,” Belsky mentioned. “5-plus years in the past, you did not see any materials {dollars} going into the artistic instruments. I suppose now everybody sees that.”

Belsky mentioned Adobe can reap the benefits of a chance to deliver Inventive Cloud to the net, which it is finished for Illustrator and Photoshop however not XD, a product that was launched in preview in 2016.

An Adobe spokesperson declined to speak about plans for an internet model of XD, and mentioned the corporate will discuss plans for Inventive Cloud at its Max convention in October.

“We don’t see an impression to the Photoshop enterprise ensuing from gamers within the product design class,” the spokesperson mentioned. “We developed and have developed Adobe XD to deal with the wants of our core design clients, who’re designing advertising and marketing experiences for screens, quite than the distinct class of product design and growth.”

Many challenges

Nonetheless, the stress on Adobe is intensifying.

Up to now three months, Figma’s app for iOS gadgets has constantly ranked above Adobe XD within the graphics and design part of Apple’s App Retailer, in keeping with figures from, previously often known as App Annie.

Wells Fargo analyst Michael Turrin mentioned Figma has potential to broaden.

“What Figma is making an attempt to create is extra of a broader platform that might turn into extra of a system of document inside this market, and that is why I believe this might turn into extra necessary,” he mentioned.

Figma is not the one upstart within the area making waves. An open-source various referred to as Penpot, which might mechanically generate the underlying supply code for designs individuals make within the software program, can also be gaining momentum.

Microsoft workers are utilizing Penpot and have contributed to it, mentioned Pablo Ruiz-Muzquiz, who co-founded the mission. Of the individuals who check Penpot, nearly 20% are coming from Figma, he mentioned.

Penpot’s code lives on GitHub, which Microsoft owns, underneath an open-source license, permitting individuals to obtain the code, modify it and run it on their very own servers. That is not true of Figma, which retains its personal supply code personal.

However Figma is evolving. One job description suggests Figma is contemplating a major replace to its iPad app that would offer an area to make new designs and never simply view or share them.

And Figma has been busy increasing its government ranks. In June, the corporate promoted Praveer Melwani, its head of enterprise operations and finance, to the finance chief place. The following month, former Deutsche Financial institution and Goldman Sachs government Kate DeLeo joined Figma as vice chairman of investor relations and enterprise operations.

As the corporate marches towards an eventual introduction to Wall Road, getting extra out of its relationship with Microsoft presents a chance for development. Increasing the variety of methods Figma will get used is one avenue.

“It really works nice as a presentation software,” Friedman mentioned.

Figma in all probability will not ever exchange Microsoft’s homegrown PowerPoint software program or Adobe’s PDF format, however Area mentioned his product boasts distinct benefits. For one, Figma avoids the issue of the continuous back-and-forth emailing of a presentation by letting individuals merely share a hyperlink. A Microsoft spokesperson mentioned PowerPoint customers can even use hyperlinks to ship paperwork.

“I might be shocked if there isn’t any salespeople at Microsoft that use it. My guess is there’s some,” Area mentioned, concerning Figma. “Is it vital? No, in all probability not.”

Not but, anyway.

WATCH: Adobe CEO reacts to Q1 earnings: Our fundamentals proceed to be extraordinarily robust

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