Hot in Enterprise IT/VC - What's 🔥 in Enterprise IT/VC #307
What's 🔥 in Enterprise IT/VC #307🙏🏼 Hope springs eternal in SaaS land...but only a rare, few like Figma
🙏🏼 Adobe for its $20 BILLION acquisition of Figma and for bringing hope to the beaten down masses of enterprise founders whose valuations have been on a downward 📉 spiral. While this gives hope to the few who can build a killer product, execute like mad, and scare the living daylights out of an incumbent, the reality is that these prices are reserved for a select few. Let’s recap, $200M ARR, forecasted to end year with $400M ARR and with 150% Net $ Retention and cash flow positive! How many companies at that scale have growth and retention like that? Yes, very very few. 😲 No IPO market, no big deal...
Just get an incumbent getting rocked by fast growth from a 🦄 and pay 2x last round price at height of market
Who's next?
All kidding aside, smart move for Adobe at 100x trailing and 50x this year ending ARR - will preserve their future Here’s the slide deck from the Adobe call with Wall Street. Using Iconiq Growth’s most recent SaaS benchmark report which you can find here, Figma is off the charts with Net $ Retention of 150% and ARR growth of a smaller company at 100% (h/t @modic123). Here’s more from from the founder… THREAD: This morning we’re announcing that @figma has entered into an agreement to be acquired by @Adobe !
More information here: figma.com/blog/a-new-col… (1/9) and from the buyer. today is a big day for both @Adobe and @figma. our teams are excited by the new possibilities and recognize both the opportunity and responsibility as we share our intent to come together. 🧵 BTW, Scott was founder and CEO of Behance prior to this and now CPO so it takes a startup founder to understand how disruptive startups can be to an incumbent. While he did not do this himself, I can surely bet that Scott led the charge. remembering the deluge of doubts in 2012 when we shared @Behance's acquisition, 10yrs later, platform grew 30x, product stronger than ever, brand intact, still free, high growth, and continued pipeline of goodness. but it takes work + principles. like all bold moves, show > tell. And no, this doesn’t mean VCs will return to paying 100x TTM ARR or 50x NTM ARR. This also does not mean that the M&A floodgates will open either as how many public companies will pay 12% of its market cap to admit defeat in one of its core businesses and pay multiples that are way higher than the highest public comps trading in the 20X range. In fact, this was not well received by Wall Street as the stock traded down 16.8% after the news erasing $29B of market cap from Adobe or more that the price it is paying for Figma. That being said, technology can be brutal and if a company misses a product cycle, it can lead to a death spiral and frankly this is an insanely smart bet that will pay off in the future. Finally, here’s a great 🧵 on building in real-time collaboration from day one versus trying to retrofit it into a product. I'm not surprised that Adobe is acquiring Figma for $20B, nor that Wall Street doesn't understand it and $ADBE stock is down more than $20B today. It's a smart move for Adobe because it's nearly impossible to make legacy software applications multi-user collaborative. Thread: 🧵 Which is also why I’m so 🔥 up about LiveBlocks, a boldstart portfolio co, an API for adding multi-player collaboration. 📝 Introducing our open-source collaborative block text editor!
Interested in building a multiplayer note-based app? We've built the foundations to make your project a reality. Add multiple types of blocks, and see them shared in real-time ✨
🔗 liveblocks.io/examples/block…
Info 👇 Thanks again to Adobe and Figma as it seemed to put a smile on everyone’s faces this week. Hope does spring eternal, and as always, 🙏🏼 for reading and please share with your friends and colleagues. Scaling Startups
if you can only remember one piece of startup advice, remember this:
"the team you build is the company you build" - @vkhosla
the rest will follow from there... Enterprise Tech
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