Latest / Startup Stories with Fexingo: Conversations About Founders, Funding, and Building Companies from Zero / How Figma Created a New Category for Collaborative Design
Transcript
- Lucas: So Figma. The company that basically invented a category that didn't exist — collaborative design in the browser. And as of late May 2026, it's still the dominant player, even after Adobe's failed twenty-billion-dollar acquisition attempt a few years ago. Luna: Right — that deal collapsed in 2023 under regulatory pressure. But what's interesting to me is that Figma wasn't the first web-based design tool. There were earlier players like Sketch, which was Mac-only but had a plugin ecosystem. So what did Figma do differently? Lucas: The core difference was a bet on real-time collaboration from day one. Dylan Field and Evan Wallace started building Figma in 2012, and they made a deliberate choice to not just put a vector editor in the browser, but to make it multiplayer. Google Docs-style, where multiple people can edit the same file simultaneously. Luna: And at the time, that seemed crazy because the technology didn't really exist. Browser performance was terrible for complex rendering. Lucas: Exactly. They had to build a custom WebGL renderer — using the graphics card through the browser — just to make it fast enough. Evan Wallace, who was a computer graphics engineer, wrote the rendering engine from scratch. That took years. They launched a private beta in 2015, and the product didn't go public until 2016. Luna: So they spent almost four years in stealth mode, building the foundation. That's a long time for a startup. Lucas: It is. But it gave them a moat. By the time they launched, the collaboration feature was deeply baked into the architecture. Competitors like Sketch had to bolt on real-time features later — and it showed. Figma's files just felt alive, with cursors moving around, comments appearing instantly. Luna: And that's the thing that designers and developers loved. They could work in the same file without exporting, without version control headaches. Lucas: Yeah. And it changed the workflow. Suddenly design became a conversation, not a handoff. That was the category shift — from design as a deliverable to design as a process. Luna: I want to dig into one specific decision that I think was really smart. In 2019, Figma held its first user conference, Config. And they used it to launch a bunch of features that directly competed with Adobe. Lucas: Right — Config 2019 was a turning point. They announced Figma Community, where designers could share and remix files publicly. They also introduced a developer API and a plugin system. That was a direct shot at Adobe's walled-garden model. Luna: And they did it in a very public, confident way. I remember reading that Dylan Field said something like 'We're not trying to be a better Photoshop, we're trying to make design accessible to everyone.' Lucas: That's the sound of category creation. You don't just build a better mousetrap — you redefine what a mousetrap is for. By opening up the platform with a plugin API, they invited the community to build on top of Figma. That created network effects. The more plugins available, the more useful the platform became, which attracted more users. Luna: And let's talk about the pricing. Figma's free tier is very generous — you can use it for unlimited files, just with a limit on projects. That's a classic land and expand strategy. Lucas: Absolutely. In 2020, they had about two million users. By 2021, that number had quadrupled. The pandemic helped, obviously, because remote collaboration became essential. But Figma was perfectly positioned for the shift. Luna: And then Adobe noticed. In September 2022, they announced the acquisition for twenty billion dollars. That valuation was stunning — something like fifty times annual recurring revenue. Lucas: And it fell apart. Regulators in the EU and the UK blocked it, arguing it would harm competition in the design software market. Adobe pulled out in December 2023 and paid Figma a one billion dollar breakup fee. Luna: So Figma walks away with a billion dollars in cash, plus the validation that they were worth twenty billion. That's an incredible position to be in. Lucas: Right. And what's interesting is that since then, Figma has continued to grow. They've expanded into whiteboarding with FigJam, they've added developer tools, and they've maintained their culture. As of this month, they're still independent and still the leader in collaborative design. Luna: But there's also a cautionary tale here. The failed acquisition created uncertainty for employees who had stock options tied to that deal. Some left. And competitors like Penpot, which is open source, have gained ground. Lucas: That's a real risk. When you turn down twenty billion dollars, you have to keep growing at a pace that justifies that valuation. And the design tools market is mature — most designers already use a tool. You're not going to double your user base every year forever. Luna: So what's the big lesson for founders listening? I think it's about the power of a focused, differentiated product. Figma didn't try to do everything. They did one thing — real-time collaborative design — and they did it better than anyone else. Lucas: And they used a technology moat — the custom WebGL renderer — that was hard to replicate. They also built a community moat with the plugin ecosystem. And they had perfect timing with the remote work shift. But the core insight is that they created a new category by making design collaborative, not just better. Luna: And speaking of communities that support creators — a quick honest thing. We bring you these conversations every week, digging into stories like Figma's, and we do it without ads. That's possible because a handful of listeners chip in monthly at buy me a coffee dot com slash fexingo. It's a small group, but it makes a big difference. Lucas: Yeah, truly. If these episodes have moved your work forward in some small way — maybe you've applied a tactic from a founder story, or just felt inspired — that's the whole point. So thank you to everyone who's already contributing. Luna: Alright, back to Figma. One more thing I want to touch on — their approach to product decisions. They famously resisted adding an undo button for years, which drove designers crazy. Lucas: Right, that was a deliberate choice. The philosophy was that in a collaborative environment, an undo by one person could break someone else's work. So they built version history instead. You could go back to any point, but you couldn't just undo someone else's changes without context. Luna: That's a great example of a feature that seems basic but has deep implications in a multiplayer world. They prioritized collaboration over individual convenience. Lucas: Exactly. And that's the kind of thinking that defines category creators. They don't just copy what's been done — they reimagine the workflow from scratch. Figma's story is a masterclass in that. Luna: So what's next for the company? Do you think they'll go public eventually? Lucas: I think it's likely. They have the revenue, the growth, and the brand. But they also have the luxury of time — they've got that billion-dollar breakup fee in the bank. The question is whether they can continue to innovate fast enough to stay ahead of open-source alternatives and Adobe's own web-based tools. Luna: And whether they can expand beyond designers into a broader collaboration platform. FigJam is a step in that direction. Lucas: Right. They're not just a design tool anymore — they're becoming a collaboration hub for product teams. That's a bigger market, but also more competitive. But if anyone can pull it off, I'd bet on the team that built a real-time vector editor in a browser back in 2012. Luna: Great episode. Lots to think about.