Lina Khan points to Figma IPO as vindication of M&A scrutiny
A notable figure expressing satisfaction with Figma’s recent successful Initial Public Offering (IPO) is Lina Khan, the former chair of the Federal Trade Commission (FTC). Khan, who led the agency’s intensified scrutiny of mergers and acquisitions, particularly in the tech sector, highlighted Figma’s market debut as a testament to her approach.
In a post on X (formerly Twitter) on Friday, Khan shared an article detailing Figma’s impressive first day of trading, where its shares surged by over 200%. She commented that the IPO serves as “a great reminder that letting startups grow into independently successful businesses, rather than be bought up by existing giants, can generate enormous value.”
Khan’s statement directly references the proposed $20 billion acquisition of Figma by Adobe, which was ultimately abandoned in 2023. While Adobe cited regulatory hurdles, specifically the lack of a clear path to approval from the European Commission and the U.K. Competition and Markets Authority, the deal also faced significant antitrust concerns within the United States. Regulators worried that the acquisition could stifle Figma’s role as an independent and effective competitor to Adobe’s own creative software offerings.
During her tenure as FTC chair, Khan spearheaded efforts to challenge Big Tech’s acquisition strategies, including “reverse acqui-hires” where companies bought key talent and licensed technology rather than purchasing startups outright. This strategy, which appears to continue even after her departure from the FTC, drew considerable criticism from parts of the tech industry.
However, Khan consistently defended her regulatory stance, noting that only a small fraction of proposed deals underwent in-depth review. She argued that such scrutiny ultimately benefits founders by fostering a competitive landscape with multiple potential acquirers, rather than a market dominated by a few large players.
Khan, who was appointed by President Joe Biden, resigned from her FTC position at the beginning of the second Trump administration. Her recent comments on Figma’s IPO suggest she views the company’s public market success as validation of her robust antitrust enforcement policies. She characterized the IPO as “a win for employees, investors, innovation, and the public.”
Conversely, some industry observers hold a different perspective. For instance, Dan Ives, a Wedbush Securities analyst, commented to Business Insider that while Figma’s success is undeniable, it stems from the company’s “innovative growth” rather than any direct impact from the FTC or Khan’s actions. This viewpoint suggests that Figma’s market triumph is an intrinsic achievement independent of regulatory interventions.
