A surprising supporter of Figma’s recent IPO is Lina Khan, the former chair of the Federal Trade Commission (FTC). In a post on X, she highlighted how Figma’s impressive first day of trading shows the potential of startups. She emphasized that allowing these companies to thrive independently, rather than being acquired by larger firms, can lead to greater value.
This comes after Adobe’s failed $20 billion acquisition of Figma in 2023. Adobe struggled to get approval from the European Commission and the U.K. Competition and Markets Authority. The deal also faced scrutiny in the U.S., where regulators were concerned about limiting Figma’s ability to compete with Adobe.
During her tenure, Khan pushed back against big tech mergers, targeting startup acquisitions. This prompted some companies to alter their strategies, opting for “reverse acqui-hires” — hiring talent and licensing tech instead of outright purchasing startups. Despite stepping down, this tactic seems to persist in the industry.
Khan received mixed responses for her tough stance. While some in the tech world criticized her, she argued that a wider range of suitors would ultimately benefit founders and foster innovation.
She resigned near the beginning of the second Trump administration but views Figma’s IPO as a success validated by her efforts. She termed it “a win for employees, investors, innovation, and the public.”
However, some believe that Figma’s success is due more to its innovative approach than Khan’s regulatory actions. Dan Ives, an analyst at Wedbush Securities, noted that Figma’s growth stemmed from its own initiatives, not from the FTC’s influence.
Figma’s story teaches us more than just business lessons; it highlights the ongoing debate about tech regulation and innovation. As startups continue to emerge, the challenge will be balancing competition with effective oversight.
For more on regulatory approaches in tech, check out resources from the FTC and the latest studies on industry dynamics.
Source link
Figma,Lina Khan
