One design tool to rule them all.
During the past several years, Figma has taken the design world by storm, becoming the go-to tool for digital product designers globally. The company initially earned its status as a beloved brand due to its community-friendly approach, designer-centricity, and freemium model. However, recent developments suggest that the tide might be turning, with people increasingly complaining about Figma’s aggressive and murky pricing strategies, head-scratching AI announcements, questionable UI redesign choices and more.
While these issues seem fixable at first glance, they reflect deeper problems as Figma navigates a high-stakes environment where growth pressures are mounting, especially after regulatory headwinds in Europe halted a massive $20 billion acquisition by Adobe and its once-unconditional user love seems to be eroding.
Given Figma’s significance in modern digital product design, its unfolding story could send shockwaves through the industry. So, let’s take a closer look: how did we get here, what’s happening now, and what can we expect next?
One design tool to rule them all
Before Figma’s rise to dominance, the design tool landscape experienced several different eras. When I started my career in the early 2000s, we were in what I would call the “Photoshop era,” where Adobe Photoshop was the industry standard for any digital (interface) design work.
I still remember the (very painful) experience of spending my first hard-earned money on buying an original license, which cost around $600 back then. It was a huge but worthy investment that allowed me to kick-start my commercial design career.
The “Photoshop era” lasted roughly for the next 10 years until new tools such as InVision and Sketch emerged, stirring the waters. At one point, InVision was the hottest design (prototyping) tool and a coveted brand to work for, partly due to their pioneering work-from-anywhere policy. However, InVision’s time on the sun was short-lived, as it eventually flamed out in a quite spectacular fashion.
Sketch seemed to be the obvious heir to the throne for a while, but ultimately its reign was also brief. There were numerous reasons for this, but let’s just say that the overall workflow was less than ideal. The Sketch/Zeplin/Abstract/InVision dynamics still give me nightmares. Anyone who worked on large design projects during that time understands the struggle.
Some might suggest mentioning Adobe XD, but it was always somewhat of an outlier — a poorly executed product that never gained significant market traction before Adobe ultimately decided to retire it.
All these tools, despite their innovations and initial success, ultimately fell short of creating a seamless design experience. None of them could maintain their momentum long enough to take over the market.
Then, in 2016, Figma launched, and by 2019, it had started to dominate. And its meteoric rise was well-deserved. It focused on solving critical problems and introduced truly innovative features. The real-time online collaboration, simple and clean interface, and enticing freemium model were groundbreaking.
Since its rise, Figma has become the primary tool for UI design, prototyping, and design systems. Its versatile capabilities make it a valuable asset even beyond UI design, extending to communication design, product ideation, data visualization, and more.
As a designer, I’ve never seen such a great multi-purpose tool in my career so far. It’s not an exaggeration to say that Figma revolutionized my daily design life, and it certainly deserves recognition for that.
Globally, Figma has created a “love brand,” particularly among younger designers and those who focus primarily on UI design.
Its savvy community engagement, strong brand equity, and initially user-friendly approaches made it easy to forget that, at the end of the day, Figma is still a business.
And businesses need to grow, especially when they’ve raised a significant amount of venture capital and are operating in a post-zero interest rate era. This is where, it seems, the current friction begins.
Since around 2019, Figma has deservedly dominated the digital product design market. The introduction of revolutionary features, an emphasis on designer-centricity, and initially friendly pricing models have helped Figma establish its industry prominence. (Image: Figma.com / jantakacs.com Illustration)
A balancing act between user love and business growth
Figma has raised approximately $750 million in venture capital to date. That’s a lot of money — and even more expectations to deliver returns. Simply because, the more money you raise, the more expectations you face.
Now, with the Adobe $20 billion mega-deal off the table, another acquisition looks unlikely, which means that to deliver on its massive (investor) expectations, Figma will likely seek to go public, through an initial public offering (IPO).
However, the path to an IPO is complex, requiring both internal factors (financial health, operational efficiency, growth momentum) and external factors (market conditions, investor sentiment) to align favourably and can sometimes take years.
As Figma pushes for significant business growth to build up its IPO momentum, the lines between user-centricity and business-centricity may continue to blur, resulting in even more complaints and uproar. Balancing user love with the pressure to grow the business is never easy.
For example, simplifying pricing plans to make them more transparent and user-friendly might seem like a no-brainer from a user perspective, but if it stalls or even decreases business growth, it becomes a much harder decision.
Similarly, calls for unlimited variables — a seemingly obvious feature from the user’s point of view — might be resisted if it negatively impacts revenue per account for example.
Or the extreme push to add expensive dev seats breaking some users’ hearts (“I’ve been an avid Figma advocate for years, and now I feel like a fool”.)
After all, Figma’s incredible annual recurring revenue (ARR) growth from $75 million in 2020 to $600 million in 2023 hasn’t come solely from user love.
It’s also been driven by aggressive sales and pricing techniques and dark patterns that leverage its dominant market position.
While Figma is not alone in adopting such strategies — big players like Adobe and Amazon have also entered these murky waters — it’s a clear indication of the challenges the company faces as it tries to satisfy both users and investors.
Figma is likely to go public in the near future but will face a tough IPO market. Current market and economic conditions have contributed to the ongoing IPO ‘winter,’ creating less favourable conditions for public offerings — especially for growth-oriented startups. (Image: jantakacs.com Illustration, Source: stockanalysis.com/ipos/statistics)
Storylines to watch
As Figma navigates its path forward, I imagine that these will be some of the key storylines to follow with potentially significant industry-wide impact.
Expanding Beyond Design(ers): Figma will need to appeal more to non-designers to expand its user base and grow beyond the design market — as there are simply not enough digital (product/UX/UI) designers worldwide to meet Figma’s business growth needs. This means enabling non-designers to design (likely with AI playing a key role) or hoping that products like FigJam or Slides gain enough traction to increase paid seats. Being designer-centric got Figma to where it is today, but it won’t get it across the next milestone.Dealing with Competitors: The competition is heating up, with big players like Miro and Canva looking to challenge Figma’s digital (product) design dominance. Miro’s acquisition of UIzard and its plans to enter the digital design space, coupled with Canva’s ever-expanding feature set and popularity, represent serious threats. Even Adobe, despite its failed acquisition attempt, could make life difficult for Figma if it leverages its deep pockets effectively.Managing Community Sentiment and Emerging Tools: Figma will need to manage the rising negative sentiment from its community and address challenges from new competitors before they get out of hand. While Figma is still far ahead of emerging tools like Penpot and Lunacy, these new alternatives could gain traction quickly if Figma falters — especially from non-enterprise customers.Navigating AI Integration: AI is omnipresent in today’s tech landscape, but deploying it well is harder than it seems, as Figma has already learned. After initial missteps, Figma will need to tread carefully between maintaining user trust, managing data collection, and sending the right signals to the broader community. Adding fuel to an already small fire could prove disastrous.Expanding (even more) into Code Delivery: I wouldn’t be surprised if Figma evolves into a tool for complete UI design and code delivery, further following its vision. It could leverage its strong engineering connections and perhaps acquire a company like Builder.io to speed up this process. This would align with the rise of design systems and the growing need for UI engineers (aka creative technologists).A big competitors with big plans await. To expand beyond the ‘traditional’ digital product design market, it will need to contend with major competitors in the broader business landscape. (Image: jantakacs.com Illustration, Sources: miro.com/about, canva.com/newsroom, prodesigntools.com, research.contrary.com/company/figma)
The way ahead and what can we learn from it
Figma’s journey from a beloved design tool to a company facing the pressures of venture-backed growth illustrates the challenges of maintaining user-centricity while pursuing aggressive business objectives. As it prepares for a potential IPO, Figma must carefully balance innovation, user needs, and business growth.
The coming months and years will be crucial for Figma. Its ability to navigate these challenges while maintaining the essence of what made it successful will determine whether it can transition from a design industry darling to a sustainable, public company without alienating its core user base.
For designers and the broader tech industry, Figma’s story serves as a case study of the delicate balance between user-focused innovation and the demands of venture-backed growth. As the company moves forward, all eyes will be on how it manages this balance and what it means for the future of design tools and the tech industry at large.
Originally published at https://www.jantakacs.com.
The story of Figma: living long enough as a hero to become a villain? was originally published in UX Collective on Medium, where people are continuing the conversation by highlighting and responding to this story.
