Technology IPO market is heating up! Figma (FIG.US) plans to land on the NYSE with a valuation of billions of dollars, can it replicate the success of Circle (CRCL.US)?

Cloud design software company Figma (FIG.US) plans to debut on the New York Stock Exchange next week and announced the IPO price range today, at $25 to $28 per share, with an estimated price of $26.50 per share. The net proceeds from the offering are expected to be around $305.9 million. Figma aims for a valuation of $13.65 billion in this IPO, with a fully diluted valuation of up to $16.4 billion, and its stock code will be "FIG". This IPO is expected to inject new vitality into the resurgent tech IPO market. According to regulatory filings submitted on Monday, Figma plans to sell nearly 37 million shares jointly with some investors, with a maximum fundraising size of up to $1.03 billion. The selling shareholders in this IPO will sell approximately 24.46 million shares (about 66%). Figma stated that the selling shareholders will not receive any revenue from the sale of Class A common stock. Underwriters have a 30-day option to purchase up to an additional 5.54 million shares of stock from certain selling shareholders. Figma plans to use the net proceeds from this offering along with existing cash to repay $330.5 million in outstanding debt under revolving credit facilities. This loan is intended to pay for pre-tax obligations and remittances related to net settlements of restricted stock units (RSUs). The company stated that any remaining net proceeds, if any, will be used for working capital and other general corporate purposes. Once this offering is completed, Figma's Chairman, CEO, and President, Dylan Field, will hold or have control of approximately 73.6% of the company's issued voting shares. Brightening U.S. IPO Market For Figma, this debut is expected to be a significant milestone. In 2022, Adobe attempted to acquire Figma for $20 billion, but the deal failed due to regulatory resistance in Europe and the UK, and both parties abandoned the merger, with Adobe paying Figma a $1 billion breakup fee. It is worth noting that the recent rebound in the US stock market and the strong performance of several new offerings have gradually eased the gloom in the US IPO market. Following the successful debut of stablecoin giant Circle (CRCL.US) last month, Figma is expected to further boost the IPO market. Circle's stock price surged at its IPO and continued to rise, sparking market discussions. As a tech giant with a supportive stance on cryptocurrencies, Figma has garnered attention on social media. Its filings show that as of March 31, the company had invested approximately $70 million in the Bitwise Bitcoin Exchange-Traded Fund (ETF) and plans to add another $30 million to invest in Bitcoin. Morgan Stanley, Goldman Sachs Group, Inc., Allen & Co, and J.P. Morgan are among the institutions serving as underwriters for this offering. Last year, the company allowed employees and early investors to cash out part of their shares through a stock tender offer, valuing the company at $12.5 billion at the time. Bold M&A Moves Figma's cloud design platform supports collaborative creation and editing of applications, websites, and software interfaces, with clients including ServiceNow (NOW.US), Workday (WDAY.US), and SAP (SAP.US). In the first quarter of 2025, the company's revenue grew by 46% year-over-year, with net profit doubling. "Figma's product is its core marketing engine. Its collaborative nature has driven viral 'bottom-up' user adoption, leading to industry-leading sales efficiency," said Tomasz Tunguz, founder of Theory Ventures. Figma also hinted at potentially making bold moves in the M&A field, with co-founder and CEO Dylan Field stating that the company is prepared to make decisions that may not seem immediately feasible. However, this IPO comes at a key time when the industry landscape is changing. While Figma focuses on artificial intelligence (AI), it also warns that AI-powered design tools may reduce some customers' reliance on its platform. The company pointed out that immigration restrictions could impact its talent recruitment capabilities and mentioned adjusting recruitment strategies in response to changes in the visa evaluation framework in the past. In 2024, most of Figma's revenue came from outside the United States. If international clients tighten budgets due to tariff pressures, the company may face the risk of softening demand. Additionally, a resurgence in trade tensions could exacerbate investors' cautious sentiment in the US IPO market, leading to more uncertainty. Leslie Marlow, corporate lawyer at Blank Rome LLP, stated that in this environment, investors will still focus on companies with sound fundamentals and a clear path to profitability.