It’s not just Figma

Under Khan-Kanter, acquisition targets fared well after blocked tech deals.

By Kainoa Lowman, Writing & Communications Associate

When European competition authorities and the Department of Justice forced Adobe to abandon its $20 billion acquisition of design software challenger Figma in December 2023, designers rejoiced—but the big story in the media was the startup’s spoiled payday. The New York Times spotlighted “deflated” employees picking up the pieces after their “$20 billion windfall evaporated,” while The Information explained it was “unlikely that Figma’s investors could expect any better alternative than Adobe.” Of course, Figma could still cash in the old-fashioned way—by becoming a publicly-traded company—but it was “maybe a $10 billion company in the public markets,” venture capitalist David Sacks predicted on the All-In Podcast. “It’s just not as good of an exit.”

They were all wrong. Last week, just eighteen months after the company’s breakup with Adobe, Figma went public. On the strength of 48% revenue growth over the past year—better than any publicly-traded software company not named NVIDIA—and an impressive free cash flow margin, Figma’s valuation soared past the $20 billion offered by Adobe. At the close of its first day of trading, the company was worth $58 billion. It is, to date, the biggest tech IPO since 2021.

Figma’s “dazzling” and “historic” IPO calls for some reflection on how antitrust actually impacted startups over the past few years of reinvigorated enforcement. A combination of loud complaints from tech investors and the media coverage of it created a narrative that Biden-appointed regulators harmed startups—not to mention the overall innovation ecosystem—by supposedly “banning” tech M&A. But the truth is that their approach to tech mergers was restrained—and when they did intervene, it often produced positive outcomes. The Figma IPO is proof of that.

Yet despite Figma’s success, the narrative that Biden’s antitrust enforcers created anti-business headwinds remains entrenched in a certain strain of the Silicon Valley worldview. When former FTC Chair Lina Khan celebrated Figma’s success on Twitter, All In podcast host Jason Calacanis snapped back that she had “single-handedly ankled the market for four years with mostly nonsensical and irrelevant interventions.” Alex Rampell, a general partner at Andreesen Horowitz, accused Biden enforcers of survivorship bias, suggesting that Figma’s success made it an outlier among startups whose acquisitions had been scuttled.

All of this is untrue. First and foremost, the narrative that Biden antitrust enforcers “bann[ed]” or “said no to almost all M&A,” in the words of former Google lobbyist Adam Kovacevich, never had any basis in reality. Proposed mergers over a certain value threshold have to be reported to the FTC and DOJ (the threshold changes incrementally every year; it has been set above $100 million since 2022). Biden-era antitrust enforcers only sent “secondary requests” for additional information to merging parties in roughly 2% of reported deals. That means, to translate this into plain, easy-to-understand English, that they only looked into 2% of the largest mergers—translating to a few dozen deals per year. They actually sued to block even fewer—just 30 suits in total, compared to 26 under the first Trump administration. Meanwhile, 98% of reported deals, and all smaller unreported deals, proceeded without any engagement from enforcers.

Source-Covington & Burling

Venture capitalists might counter that these numbers don’t include deals that were not attempted at all thanks to the enforcers’ tougher posture. That is true, but they provide important perspective regarding the size of deals that might have been deterred: entrepreneurs flipping a startup for a few million, or even a hundred million, did not have their payday spoiled by antitrust considerations. And while it can’t be proven definitively, a number of industry analysts doubt that antitrust deterrence accounts for the post-COVID slowdown in large-scale tech M&A. General macroeconomic headwinds are likely a major factor. As startup valuation expert Dan Gray wrote for us in February, VCs looking to cast blame should also look inward, at their own unsound investing practices that inflated valuations when interest rates were low—and thus made their portfolio companies unattractive to potential acquirers and public markets in the current economic environment.

As for the deals scuttled by antitrust enforcement, it’s instructive to look at how Figma responded to the Adobe deal falling through. Figma CEO Dylan Field “pushed into overdrive,” in the words of The Information, adding several features to its core web design platform, and releasing an avalanche of new products, including prompt-to-code tool Figma AI, presentation software Figma Slides, website hosting service Figma Sites, brand asset manager Figma Buzz, and Figma Draw, a direct competitor to Adobe Illustrator.

This kind of reaction is far from uncommon within the short list of Biden-era tech deals undone by antitrust. Most—though not all—former target companies also fared well by proceeding to double down on innovation and create more value:

• In November 2020, the Trump DOJ sued to block Visa’s $5.3 billion acquisition of fintech startup Plaid, which securely connects consumer bank accounts to financial applications like Venmo and Robinhood. The deal was terminated in January 2021 amid sustained pressure during the presidential transition. Since then, Plaid has expanded into credit underwriting, anti-fraud, onboarding, and more. Plaid is valued at $6.1 billion as of an April 2025 fundraising round, at which time the company reported that revenue grew 25% year-over-year—in significant part thanks to new products—and is approaching “sustained profitability.” It’s widely viewed as just a matter of time before Plaid goes public, although the company has said it will not do so this year.

• In March 2021, the FTC initiated a legal fight to block Illumina’s $7.1 billion acquisition of cancer test maker Grail, which ultimately resulted in Illumina agreeing to divest the by-then-acquired company in December 2023. Since going public as an independent company in June 2024, Grail’s valuation has more than doubled.

• In December 2021, the FTC sued to block NVIDIA’s $40 billion acquisition of chip design firm Arm; the deal was terminated in February 2022. Since going public in September 2023, Arm’s valuation is up nearly 170%. The company’s forward price-to-earnings ratio, a measure of investor growth expectations, is about three times that of NVIDIA.

• In July 2023, the FTC sued to block IQVIA’s reported $700-$800 million acquisition of Propel, the parent of healthcare-focused digital advertising platform DeepIntent. A court blocked the deal in December 2023, and it was abandoned shortly thereafter. The financial story here is murky: Propel stock is a highly-illiquid “Expert Market” security, and the company does not report financial performance. But it’s clear DeepIntent is innovating and growing. Its vaccine campaign solution was named an innovation of 2024 by trade publication PM360; in 2025 it launched AI-enabled upgrades to its platform and integrated with new publishers. The company is currently hiring to fill 13 roles, including director-level positions.

• In January 2024, Amazon abandoned its $1.4 billion acquisition of Roomba maker iRobot amid probes from the FTC and European authorities, who feared that Amazon might tilt the ecommerce scales against iRobot’s rivals. This is the one blocked Biden-era tech merger that does not have a happy ending for the target company. iRobot, which had been struggling to innovate and compete prior to the proposed deal, has continued its downward slide.

• In July 2024, negotiations for Google to acquire cybersecurity unicorn Wiz for $23 billion fell apart amidst regulatory concerns. Wiz was already growing at a historic pace and has continued its trajectory, targeting $1 billion in annual recurring revenue after breaking $500 million in 2024. In March, Google upped its offer significantly and locked in an agreement to buy Wiz for $32 billion (the Trump DOJ is reportedly probing the new deal). Prior to that, Wiz had reportedly been eyeing an IPO, which was expected to be one of the biggest in recent years.

None of this is to suggest that antitrust enforcers have financial markets in mind when they evaluate mergers. Their sole mandate is to protect competition, and they executed it faithfully in each of the cases described. But the key lesson is that protecting competition has not come at the expense of financial success for startups, contrary to lazy narratives from certain corners of the industry. If anything, it’s likely done the opposite. If you’re building a company that is large and promising enough to be on the radar of antitrust authorities at all, it’s quite possible you can do better than selling to an incumbent. The Figma IPO is just the latest proof. It won’t be the last.