Lina Khan Calls Figma IPO a ‘Victory Lap’ for Antitrust Enforcement
In August 2025, design software company Figma made headlines again because of its IPO. This time, it wasn’t about a new feature. It was about money and a message.
Figma went public with a bang. Its stock price soared on the first day, giving it a huge valuation of around $68 billion. But behind the numbers, something bigger was happening.
Lina Khan, the chair of the U.S. Federal Trade Commission (FTC), had something to say. She called Figma’s IPO a “victory lap” for antitrust enforcement. What did she mean by that?
Well, let’s rewind a bit. In 2023, Adobe tried to buy Figma for $20 billion. But regulators, including Khan, pushed back. They said it would hurt competition. So the deal fell apart.
Now, two years later, Figma proved it could win on its own.
Let’s explore why Khan’s words matter, what the IPO means for tech and law, and how this moment could shape the future of innovation.
Background: The Abandoned Adobe‑Figma Deal
In late 2022, Adobe proposed buying Figma for about $20 billion. Regulators raised antitrust concerns and blocked the deal in December 2023. The deal fell apart under pressure from U.S. and European authorities. Figma then continued on its path.
The Figma IPO: A Showcase of Market Strength
Figma priced its public offering at $33 per share on July 31, 2025. The IPO raised around $1.2 billion and valued the company at close to $19.3 billion on a fully diluted basis.
Demand overwhelmed supply. Shares opened at about $85 and closed at $115.50. That is more than a 250% gain for the day. The final market cap approached $68 billion. This made Figma’s debut the most explosive U.S. IPO of its size in decades.
Lina Khan’s Victory Lap: What She Said?
Former FTC Chair Lina Khan took to X (formerly Twitter) to note that Figma’s success showed the value of letting startups grow independently. She called the IPO a “victory lap” for antitrust enforcement. Her point: stopping monopoly deals can help innovation thrive. She wrote that independent growth is a win “for employees, investors, innovation, and the public”.
Supportive Perspectives
Proponents of stronger antitrust enforcement see Figma’s IPO as proof that small companies can flourish alone. Tech policy advocates argue that Khan’s opposition to the Adobe merger opened the door for independent value creation and competition. This view highlights the importance of regulatory scrutiny in preserving startup-led innovation.
Criticism and Nuance
Critics say Figma’s outcome is more about strong product execution and timing. Analysts at DA Davidson point to the company’s 46% year-over-year revenue growth in early 2025 and its healthy profitability metrics, including gross margins around 90% and a high Rule of 40 score.
Some also argue the IPO price run-up partly reflects pent-up investor demand after years of weak tech listings, not necessarily long-term company strength. As Business Insider notes, underwriters may have left billions on the table by underpricing the offering amid rushes of investor interest.
Broader Implications for Antitrust Policy
Figma’s case now serves as a high-profile example in the debate over Big Tech M&A. It underscores a model of enforcement where regulators decide to block major mergers, believing that startups left alone can deliver better outcomes. This stance has ripple effects in startup culture: some founders may now aim for independence rather than early acquisition.
As deals blocked under Khan’s leadership become symbols, debate intensifies over whether antitrust oversight helps or hinders innovation in the long run.
Potential Risks and Counterfactuals
Could Figma have been stronger within Adobe? That merger had potential synergies, especially with Adobe’s Creative Cloud tools. Critics suggest that some corporate pairing might accelerate growth faster.
Also, first-day IPO gains don’t always stick. Stock could dip after the six‑month lock‑up period. Market euphoria may fade, and the price could fall if performance disappoints.
Business risks include the heavy investment in AI capabilities. Figma introduced several new AI-driven tools in 2025 (like Figma Sites and Figma Make), which may weigh on efficiency in the short term, even though leaders see them as core to future growth
Figma IPO: Final Words
The Figma IPO isn’t just a business success story; it’s a turning point. It shows us what can happen when a startup is allowed to grow without getting swallowed by a giant. Lina Khan views this as evidence that robust antitrust rules are effective. And in many ways, she has a point.
But not everyone agrees. Some say Figma would’ve done well no matter what. Others believe blocking deals could slow down progress in some cases.
Still, one thing is clear: Figma stood on its own and soared. That’s a big win for competition, creativity, and future tech founders. No matter whether you support Khan’s approach or not, this moment will shape how we view mergers, innovation, and public markets for years to come.
Frequently Asked Questions (FAQs)
Regulators stopped the deal because they felt it could reduce competition. They believed both companies offered similar tools and feared the deal might limit user choices in the future.
Figma’s strong IPO shows a company can succeed without being bought by a bigger firm. It supports Khan’s idea that keeping markets open can help innovation and growth.
Disclaimer:
This is for information only, not financial advice. Always do your research.