Figma's $16 Billion IPO Set to Test U.S. Tech Market Demand

Figma is preparing to enter the public market with an initial public offering (IPO) that eyes a valuation of approximately $16 billion. The software company, which specializes in collaborative design tools, has set a tentative pricing range for its shares between $25 and $28. This closely monitored offering is set to be a significant test for the U.S. technology IPO market.

A noteworthy aspect of Figma's IPO strategy involves allowing existing shareholders to sell a substantial number of shares, outstripping the amount initially being floated by the company. Figma intends to offer around 12.5 million new shares, while existing shareholders have the opportunity to sell close to 24.7 million shares. This approach highlights the high demand anticipated for Figma's stock, with an additional option for shareholders to sell up to 5.5 million more shares if the IPO generates strong interest.

Dylan Field, Figma's founder and CEO, has announced his intention to sell 2.35 million shares, which could net him over $62 million based on the mid-range of the pricing estimate. Even after selling these shares, Field will maintain significant control over the company, holding 74% of the voting rights due to the supervoting structure of Figma's Class B shares. This structure awards 15 votes per share, and Field also possesses the right to vote the Class B shares owned by his co-founder, Evan Wallace.

Key venture investors, including Index Ventures, Greylock Partners, Kleiner Perkins, and Sequoia Capital, are also planning to sell significant portions of their holdings, with potential sales ranging from 1.7 to 3.3 million shares each. These sales allow them to return capital to their investors amid a challenging venture market that is currently experiencing reduced liquidity. Despite these sales, it is important to note that these investors are retaining the bulk of their investments in Figma.

The secondary sales strategy appears to be a tactical move to meet high market demand, as the number of shares originally planned for release might not have sufficed otherwise. While the company itself will not directly profit from the shares sold by existing stockholders, a higher pricing of the IPO could increase the overall capital raised, benefiting both the company and its shareholders.

Before the IPO pricing, experts had estimated that Figma could raise approximately $1.5 billion. If the shares are priced higher than anticipated, not only could this figure be surpassed, making it one of the most significant IPOs of the year, but it could also become the largest technology listing of 2025 so far. With the IPO possibly taking place as soon as next week, anticipation is high, though Figma has refrained from further public comment at this time.