Adobe, one of the world’s largest software companies, said on Thursday that it would acquire the design platform Figma for $20 billion, a deal that comes amid a slump in merger activity in the tech world.
Figma, which was founded in 2012, has raised more than $332 million in funding, according to Crunchbase, and was valued at $10 billion in 2021. The company allows multiple people to collaborate on design projects in the same files at once.
“It’s happening in a market that has cooled down for technology companies as a whole,” said Danny Rimer, a partner at the venture capital firm Index Ventures, Figma’s biggest backer. “It’s more a reflection of how well Figma is doing as a business, how much thought leadership the combination of Adobe and Figma will have and the strength of the management team.”
Adobe’s purchase of Figma coincides with a cooling in deal-making and decreased valuations for technology companies as recession fears build. The value of deals in the United States has totaled about $1.2 trillion so far this year, compared with $2 trillion in 2021, according to the data firm Dealogic.
Federal Reserve officials have affirmed their commitment to bringing down inflation by continuing to raise interest rates, a prospect that has spooked investors. The tech-heavy Nasdaq index has fallen 26 percent since the beginning of the year and had its worst day since June 2020 on Tuesday.
Shares of Adobe slid nearly 17 percent on Thursday, and have fallen 45 percent this year.
“Adobe’s greatness has been rooted in our ability to create new categories and deliver cutting-edge technologies through organic innovation and inorganic acquisitions,” Shantanu Narayen, Adobe’s chief executive, said in a statement. “The combination of Adobe and Figma is transformational and will accelerate our vision for collaborative creativity.”
