Lina Khan References Figma IPO to Support M&A Regulation

An unlikely advocate is commending Figma’s impressive IPO: Lina Khan, the former chair of the Federal Trade Commission.

On Friday afternoon, Khan posted on X, linking to an article that discussed Figma’s outstanding stock market debut, asserting that the IPO serves as “a compelling reminder that enabling startups to grow into independently thriving entities, rather than being assimilated by larger firms, can create significant value.”

Khan referred to the attempted $20 billion acquisition of Figma by Adobe, which fell through in 2023. Adobe cited a lack of “clear path” for obtaining approval from the European Commission and the U.K. Competition and Markets Authority, and the deal faced regulatory hurdles in the U.S. due to concerns it could weaken Figma’s competitive strength against Adobe.

During that timeframe, Khan led the FTC, directing the agency’s initiatives to scrutinize Big Tech in relation to startup acquisitions—advocating for “reverse acqui-hires,” where companies hire critical talent and license technology instead of outright purchasing startups. (This trend seems to persist even after Khan’s exit from the FTC.)

Despite encountering significant pushback from certain areas of the tech industry, Khan defended her stance by highlighting that only a minor percentage of deals received “a second look,” contending that founders would do better in “a market with six, seven, or eight potential buyers” rather than “only one or two.”

Though Khan—appointed by President Joe Biden—stepped down at the outset of the second Trump administration, her comments on Friday framed the Figma IPO as an affirmation of her approach, calling it “a triumph for employees, investors, innovation, and the public.”

Naturally, Khan’s critics are more likely to credit Figma’s achievements to innovation free from regulatory interference, rather than as a byproduct of it. Wedbush Securities analyst Dan Ives remarked to Business Insider, “Figma is a remarkable success, but it’s due to the company’s innovative growth and not as a result of the FTC and Khan.”