Source: Figma considered a higher IPO price, but CEO Dylan Field wanted to bring on board certain long-term institutional shareholders and approved $33/share
Should You Chase the Surge or Wait for a Pullback? Fortune : Tech industry insiders share their picks for the next startups who will ride the IPO wave after Figma's blockbuster debut Anna-Louise Jackson / Fast Company : Bullish IPO aims to capture OpenAI-era enthusiasm for high-risk tech Chad Wilson / SiliconANGLE : On theCUBE Pod: Venture capital windfalls, AI reality checks and the shell games of big cloud Reuters : Figma sheds $11 billion in market value days after blockbuster IPO San Francisco Business Times : Figma's successful IPO creates ‘warm reception’ for next wave Craig Coben / Financial Times : Figma's IPO was fine, actually X: Vishal K. Gupta / @vishalkgupta : “CEO wanted to bring on board certain long-term institutional shareholders” If this is true.. this is the stupidest shit ever John Wang / @j0hnwang : Figma underpriced its IPO to please the gatekeepers. It's easier to comply with the system than go against it Until we rebuild capital markets structure (crypto?) or a brave behemoth defies them (e.g. SpaceX establishing a new precedent), founders will keep folding to the cartel Thomas Robb / @breakingsaas : You give them a partial position. There's only so many high-quality, long-term growth funds that can make sizable investments in public markets. Each of them have a target % of fund for a full position. You give them 10-20% of the position. You can back into how much will be John Wang / @j0hnwang : yes, bring on board “long-term investors” by giving them zero lockup and an 80% discount to opening price that's one way to light $3B on fire while getting applauded by Wall Street Geoffrey Woo / @geoffreywoo : Maybe we shouldn't feel bad for @zoink and his shareholders because it's his company and his money and why is everyone pocket counting these new billionaires and millionaires. If you go IPO, you can go negotiate with your ibanks and charge a higher list price. Bill Gurley / @bgurley : Consider this. If you leave those investors on the sideline don't they represent massive future buying support? Or do you assume they would shun you out of spite? And if that's true - why do you want them again?
Context & Ripple Effects
Figma entered the offering with strong indicated demand: its earlier raised IPO range and heavily oversubscribed order book gave management latitude over how to allocate shares, not just where to set the price.
The listing also follows Figma's effort to remain independent after its failed sale to Adobe, making the shareholder base at public-market entry consequential to the company's next phase.
First-order effects
- Figma priced its IPO at $33 a share despite considering a higher level, prioritizing allocations to selected long-term institutional investors over the highest possible initial price.
- The institutions included in those allocations gain an early position in Figma, while other prospective buyers face a smaller or no allocation at the offering price.
Second-order effects
- The decision makes IPO bookbuilding a test of investor quality as well as demand: banks and issuers may place greater weight on holders expected to remain engaged after trading begins.
- A lower-than-possible offer price can sharpen the trade-off between proceeds for existing shareholders and a stable aftermarket supported by the chosen allocation base.
Third-order effects
- If other high-demand offerings follow this approach, IPO pricing may increasingly be treated as a shareholder-selection mechanism rather than a simple exercise in maximizing the offer price.
- Figma's independent public debut adds to the case that startups can pursue public-market scale instead of an acquisition, a framing reinforced by regulators' view of its IPO as evidence for preserving independent competitors.
The trend: High-demand tech IPOs are increasingly being positioned around durable institutional ownership and independent scale, not solely the highest headline valuation.