Adobe Systems recently announced that it has entered into a definitive merger agreement to acquire Figma, the developer of a very popular, web-based collaborative design platform. Ashley Still, Senior Vice President and General Manager, Digital Media at Adobe Systems, leads marketing and partnerships for the digital media business. Still spends a lot of her time driving business strategy and growth for Adobe. Hence, I was excited to talk with her about Figma and understand the backstory behind the press release. There have been some naysayers out there and I wanted to go directly to the source.
Product design as an emerging discipline
Five years ago, there might have been fifty or even a hundred engineers and just one designer thinking about the user experience. All that has changed as the user experience has become much more important. The product design element of software design has exploded, and the ratio of software engineers to product designers has decreased dramatically.
As more companies build software applications, mobile applications, and digital experiences, a considerable market for product design software has emerged that is growing incredibly quickly. Figma saw the opportunity and pioneered web-based design as part of this new market.
The web-based design allows access to a single source of truth through collaboration. Product designers, software engineers, product managers, and product marketers are all part of the ecosystem, ensuring the user experience is the best it can be before code writing starts.
Figma's growth has come from the viral nature of the software. Teams start using it as web-based collaboration and central to the design process, spreading it to other groups within the company. The company has unique software in a fast-growing category adjacent to Adobe's core business. And it is still early days for this type of dedicated software, as many companies building software still design the user experience in applications such as PowerPoint and Vizio.
Adobe offered a UI/UX design and collaborative product called Adobe XD. Adobe XD started as a desktop application and consequently never succeeded in being the single source of truth and hence has not achieved broad-scale adoption and growth to the level of Figma. A casual observer might conclude some product competition or overlap, but after a lot of analysis, I believe the Adobe XD revenue is immaterial to Adobe’s business.
The convergence of productivity and design
The Figma platform has extensions to improve design workflows by connecting Figma to other tools, scripts, and web applications. It has
demonstrated the ability to build new compelling applications on the platform with a product called FigJam, which goes beyond product design.
FigJam is a whiteboarding application. Figma saw that people started using Figma as a multiplayer canvas to discuss ideas and gain consensus. Figma created an easy-to-use application specifically for ideation and already has a third of current users using this whiteboarding application.
The convergence of productivity and design is happening because people need to communicate not just with words and numbers but also with visual content. More productivity involves visualization; the research report is more than just typing; it is also a video broadcast. I see that in my own company, as companies place more value on video podcasts rather than a whitepaper or an article.
Within companies, communication and collaboration are becoming more visual. Adobe does not currently have whiteboarding as part of the portfolio, unlike other players such as Canva, Apple, and Microsoft. The opportunity to integrate the FigJam whiteboarding product across the Adobe portfolio is a significant area of value expansion for Adobe customers and an opportunity for future innovation.
Likely much more than the sum of the parts
I believe, and so does Adobe, that there is an opportunity for collaborative creativity. The merged companies could co-create new experiences and capabilities, bringing Adobe's decades of media experience across imaging, illustration, and video to build new applications on the Figma web-based collaborative platform.
I also think there are immediate opportunities to streamline workflows and eliminate much of the back-and-forth and lost productivity between Figma and Adobe products. Adding Adobe fonts, imaging, and vector graphics workflows into the Figma platform would result in innovation and productivity gains.
Future applications and workflows will come from reimagining core categories, such as web-based, collaborative image editing, photography, and illustration. Some unique synergies exist between the two companies, such as Adobe's core technologies and expertise in artificial intelligence (AI) that could be married to Figma's web-based “multiplayer platform.”
The potential for driving innovation and creating new applications is a real possibility once the design and product design teams can integrate all of Adobe's fonts and Stock within the Figma design offering.
I can’t even imagine how awesome it would be working on the same Adobe Photoshop object in parallel, real time, versus sharing files in a serial fashion.
I believe collaboration is the future; immersion and creativity will drive differentiation. I speak to many companies and constantly hear the need to compete on the user experience. More companies will create differentiated user experiences in collaborative environments with easy-to-use and capable tools. I believe Adobe is on the cusp of that new opportunity, which is why I believe the acquisition of Figma is transformative and exciting.
The transaction will close in 2023 if the deal clears the anti-trust regulatory clearances and approvals hurdles. Nothing stops other companies from developing versions of collaborative design environments, but it is impossible to predict the anti-trust decision. That said, after a lot of thought and introspection, I do not believe Adobe and Figma are meaningful competitors; Figma is a leader in product design, and Adobe is a leader in creative tools.
I do think it is an adjacency. The core of Adobe's Creative Cloud business is in image editing, photography, illustration, video, and all of that's complimentary.
One possible monkey wrench cited by others is Adobe XD. Adobe XD has a different product approach as a desktop application focusing on UI/UX design versus Figma, which concentrates on web-based product design and collaboration. In product design, it is about ensuring everyone is on the same page - Adobe XD does not have that capability, and efforts to bring collaboration to a desktop application were unsuccessful. While Adobe is continuing to support existing Adobe XD customers, I believe it is not a meaningful competitor. If and when the deal goes through, I don’t expect Adobe XD to stick around.
As the growth rate continues, I predict people will look back and say it was a good deal, perhaps even a brilliant one. Most importantly for Adobe customers, the synergies promise to deliver value creation and a software platform for your collaborative creativity.