Why Adobe is spending 20 billion to buy a competitor

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Adobe is carrying out its biggest external growth operation by acquiring Figma.

Why Adobe spends 20 billion to buy a competitor

At a time when the American Tech world sees the clouds gathering on the horizon, the announcement of the acquisition of the company Figma, editor of collaborative cloud tools, for 20 billion dollars does not go unnoticed.

In concrete terms, this startup was valued at ten billion dollars during its last round of financing last year , remind our colleagues from CNBC. It is expected to generate $400 million in annual revenue this year. Above all, it is in direct competition with Adobe's XD program.

Wall Street heavily penalizes Adobe

Figma is a popular solution among designers. The software allows them in particular to design prototypes, or to see more clearly in terms of user experience. Ellee also offers FigJam, a whiteboard software, ideal for business meetings, reports The Moderator's Blog. There is no doubt that the professionals concerned will follow this takeover closely, hoping that these tools will not be too impacted.

Logically, the CEO of Adobe praised the merits of this agreement: “ < em>Adobe's greatness has been rooted in our ability to create new categories and deliver cutting-edge technologies through organic innovation and inorganic acquisitions. The combination of Adobe and Figma is transformational and will accelerate our vision of collaborative creativity. ”

If the transaction is completed, Dylan Field, the and current CEO of Figma, will still lead the startup. He will nevertheless have to report to David Wadhwan, president of Adobe's digital media activity.

In any case, this transaction raises questions because Adobe will therefore pay 50 times the turnover of this startup to take control of it. Yes, but the latter is a real nugget that is experiencing dazzling growth, recalls Les Échos. Thus, this little rival has quintupled its income over the past two years, and in the long term it risked overshadowing the editor of Photoshop.

Be that as it may, these arguments have not really reassured investors who do not seem to appreciate this maneuver. Adobe's stock fell 17% on Wall Street on Thursday, bringing its market capitalization to $29 billion.

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