Figma CEO on failed Adobe deal, startup landscape, big redesign with AI

CNBC Television
26 Jun 202404:36

TLDRIn this interview, the Figma CEO discusses the failed Adobe acquisition, emphasizing the company's continued growth and innovation during the process. He highlights Figma's use of AI, specifically mentioning the adoption of Open AI and Amazon-hosted diffusion models, and their approach to pricing for AI features in 2024. The CEO also reflects on the startup landscape and the potential for a successful AI company in design, hinting at Figma's future path towards independence and possibly an IPO.

Takeaways

  • 🧠 Figma is integrating AI into their product to enhance designers' capabilities, not just as a superficial feature but deeply embedded for functionality.
  • 🤖 They are currently using Open AI for their language models and Amazon-hosted diffusion models, chosen for their effectiveness in Figma's use cases.
  • 🔄 The CEO acknowledges the rapid development in AI, suggesting that models may become commoditized and interchangeable as the field evolves.
  • 💡 Figma is planning to offer their AI features for free during the beta phase in 2024, with the intention to assess usage patterns before setting pricing for a broader rollout.
  • 💸 The company will 'eat the cost' of the AI features in 2024, as they are uncertain about user engagement and the associated expenses.
  • 📈 Figma will observe the beta usage to inform their pricing strategy, which they plan to communicate clearly in 2025.
  • 🔑 The CEO hints at the possibility of exploring different pricing models, such as subscription or per-usage, drawing parallels to the strategies of other chatbot services.
  • 🌐 Figma's approach to AI is focused on improving the designer's experience by integrating AI deeply into the product, rather than just adding AI as a feature.
  • 🚀 The CEO reflects on the current landscape of AI companies, comparing it to the dot-com era, suggesting that significant, foundational companies are being built amidst the current boom.
  • 🛑 The failed Adobe deal has not deterred Figma, as they continued to innovate and accelerate their product development, showcasing new features and a redesign.
  • 🏁 With the M&A path explored, Figma is now considering an IPO as a potential future step, focusing on building as an independent company.

Q & A

  • What AI technologies is Figma utilizing for its features?

    -Figma is using Open AI for their LMs and a diffusion model hosted by Amazon, as these were the ones that worked well for their use cases.

  • How does Figma approach the modularity of AI models in their system?

    -Figma builds the AI integration in a modular way, allowing them to swap out models as needed since the only constant in the field is change.

  • Are AI models becoming commoditized in the creative industry?

    -While it takes work to change out things for other models, the CEO of Figma suggests that the field is in a period of rapid development with models getting faster and prices decreasing, indicating a potential for specialization and competition among model companies.

  • What is Figma's strategy for the pricing of their AI features during the beta phase?

    -Figma will make the AI features free during the beta mode to understand how people use these features and what the usage looks like, with the intention to determine the costs and pricing for a broader rollout in 2025.

  • How does Figma envision the future pricing model for their AI features?

    -Figma plans to observe the usage during the beta phase and will determine the pricing based on that, with clear communication of costs expected in 2025.

  • What is Figma's stance on subscription models similar to those used by chatbots?

    -Figma is considering different models and will decide over time, emphasizing that their approach is different from a chatbot and focuses on integrating AI to improve the designer's life.

  • What are the CEO's thoughts on the current landscape for AI companies in design?

    -The CEO reflects that it's hard to predict which AI companies will be successful, likening the current period to the early 2000s, where significant companies like Amazon and Google emerged.

  • How does the CEO of Figma view the failed Adobe deal and its impact on the company?

    -Despite the failed deal with Adobe, Figma kept accelerating and is now able to announce new features and improvements, demonstrating the company's resilience and continued growth.

  • What are Figma's future plans regarding M&A or IPO?

    -The CEO hints at the possibility of an IPO in the future, as Figma has explored the M&A path and is now focusing on building as an independent company.

  • What is Figma's approach to integrating AI into their product?

    -Figma aims to deeply integrate AI into their product to add functionality that genuinely improves a designer's life, rather than just superficially adding AI features.

  • How does Figma plan to handle the costs associated with offering free AI features in 2024?

    -Figma intends to cover the costs themselves for 2024, as they are uncertain about the usage patterns and costs associated with the new AI features.

Outlines

00:00

🚀 Embracing AI for Creative and Product Enhancement

The speaker discusses the integration of AI into their product, specifically mentioning the use of Open AI for their language models and a diffusion model hosted by Amazon. They emphasize the importance of modularity in AI implementation to adapt to the rapidly changing landscape of AI technology. The conversation touches on the potential for model commoditization and the company's strategy to stay agile in this competitive field.

💡 Navigating AI Pricing and Business Models

This section delves into the pricing strategy for Figma's AI features, starting with a beta phase offered for free to gauge user engagement and usage patterns. The company plans to cover the costs in 2024, with the intention of adjusting the pricing based on beta feedback. The speaker also contemplates different pricing models, such as subscription or per-usage, and the need to align with the product's value to designers.

🌟 The Future of AI in Design and the Path to Success

The CEO of Figma reflects on the broader implications of AI in the design industry, pondering the criteria for a successful AI company. They draw parallels with the tech boom of the early 2000s, suggesting that current investments may lead to the rise of pivotal companies in the future. The discussion also includes the company's experience with a failed acquisition attempt by Adobe and the lessons learned from maintaining momentum during that period.

Mindmap

Keywords

💡Figma

Figma is a cloud-based design tool used for creating user interfaces, prototypes, and design systems. It is central to the video's theme as the CEO discusses the company's approach to integrating AI and its future plans. In the script, Figma's CEO talks about the company's decision to keep innovating during the acquisition process with Adobe, which shows Figma's commitment to independent development and innovation.

💡Adobe deal

The 'Adobe deal' refers to a previously attempted acquisition of Figma by Adobe, which did not go through due to regulatory issues. This is a significant part of the video's narrative as the CEO reflects on the aftermath of this deal and how it influenced Figma's strategy moving forward. The CEO mentions that despite the deal falling through, Figma continued to accelerate its development, indicating resilience and a focus on growth.

💡AI

Artificial Intelligence (AI) is a branch of computer science that aims to create machines capable of intelligent behavior. In the context of the video, AI is a key focus for Figma as they explore its integration into their design tools to enhance user capabilities. The CEO discusses using AI to 'supercharge' existing powers and mentions the use of AI in their product features, highlighting its importance in the company's innovation strategy.

💡LMs

LMs stands for 'Large Models,' which in the context of the video, refers to the AI models that Figma is using to enhance their design capabilities. The CEO mentions using Open AI for their LMs, indicating a reliance on advanced AI technology to improve their product offerings and stay competitive in the design software market.

💡Modular

In the video, 'modular' refers to the design approach where components can be easily interchanged or upgraded. The CEO talks about building AI capabilities in a modular way, allowing for flexibility and adaptability as the technology evolves. This approach is crucial for Figma to remain agile and responsive to rapid changes in the AI field.

💡Commoditization

Commoditization is the process by which goods or services become similar in quality and price, turning into commodities. The CEO discusses the possibility of AI models becoming commoditized, suggesting that as the technology matures, it may become more standardized and interchangeable, which could impact how Figma sources and integrates AI into their products.

💡Pricing

Pricing in the video refers to how Figma plans to monetize their AI features. The CEO explains that they will offer the AI features for free during the beta phase to understand user engagement and usage patterns. This strategy is part of Figma's broader approach to understanding market dynamics before setting a price for a broader rollout.

💡Beta mode

Beta mode is a phase in software development where the product is tested by a select group of users before a full release. Figma's CEO mentions that their AI features will initially be in beta mode and free to use, allowing them to gather feedback and data on user interaction with the new functionalities.

💡Subscription model

A subscription model is a business approach where customers pay a recurring fee to access a product or service. The CEO contemplates whether a subscription model would be suitable for Figma's AI features, comparing it to other models like per-usage pricing. This consideration is part of Figma's strategic planning for monetizing their AI capabilities.

💡Chatbot

A chatbot is an AI-powered conversational agent used for customer service or interactive applications. In the video, the CEO distinguishes between a chatbot approach and a product approach when discussing AI integration. Figma aims to deeply integrate AI into their product to enhance functionality and user experience, rather than just adding AI as a superficial feature.

💡IPO

An Initial Public Offering (IPO) is when a private company goes public by offering its shares for sale to the general public for the first time. The CEO hints at an IPO as a potential path for Figma after exploring the M&A route with Adobe, suggesting that going public could be the next step in Figma's growth strategy.

Highlights

Figma CEO discusses the failed Adobe deal and the company's continued growth and innovation post-acquisition.

Figma is utilizing Open AI for their language models and Amazon-hosted diffusion models in their AI features.

The CEO explains the choice of AI models based on their performance and the need for modularity to adapt to rapid changes in the field.

AI models are becoming more commoditized, with the expectation of specialization among model companies in the future.

Figma's AI features will initially be offered for free during the beta phase, with costs to be determined based on usage patterns.

The CEO emphasizes the importance of understanding user behavior to inform future pricing strategies for Figma's AI tools.

Figma is considering different pricing models, including subscription or per-usage basis, for their AI offerings.

The CEO differentiates Figma's approach to AI integration, focusing on enhancing the product's functionality for designers.

Reflections on the current landscape of AI companies in design, with a historical comparison to the dot-com era.

The CEO's perspective on what makes a successful AI company and the challenges of identifying future industry leaders.

Six months after the failed Adobe deal, Figma's strategy of maintaining momentum and accelerating product development.

Figma's billion-dollar breakout fee and the CEO's hints at a potential IPO as a future path for the company.

The CEO's vision for Figma as an independent company, focusing on building for the long term.

Discussion on the rapid development in the AI field and its impact on pricing and model performance.

Figma's commitment to offering AI features that genuinely improve designers' workflows and product experiences.

Insights into the startup landscape and the challenges and opportunities presented by the current AI revolution.

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