Lina Khan Uses Figma’s IPO as a Platform to Push for Stricter M&A Regulations

Lina Khan, the former chair of the Federal Trade Commission, is commending Figma’s remarkable IPO.

On Friday afternoon, Khan posted on X, linking to an article that details Figma’s successful market debut, asserting that the IPO serves as “a strong reminder that supporting startups to thrive as independent entities, rather than allowing larger firms to acquire them, can yield substantial value.”

Khan highlighted Adobe’s unsuccessful bid to purchase Figma for $20 billion in 2023, referencing concerns about the lack of a “clear pathway” to approval from the European Commission and the U.K. Competition and Markets Authority, along with regulatory worries in the U.S. regarding a potential reduction in Figma’s competitiveness against Adobe.

During her tenure at the FTC, Khan led initiatives to examine major tech companies’ acquisitions of startups—arguing for “reverse acqui-hires,” which would allow firms to retain vital talent and license technology rather than merely absorbing the startups. (This trend seems to persist even after her departure from the FTC.)

Despite considerable pushback from certain parts of the tech industry, Khan remained resolute in her views, contending that only a small number of deals received “a second look” and stressing that founders could thrive in “a market with six, seven, or eight potential buyers” instead of “just one or two.”

Though Khan—appointed by President Joe Biden—resigned at the start of the Trump administration’s second term, her remarks on Friday positioned the Figma IPO as a validation of her philosophy, calling it “a win for employees, investors, innovation, and the public.”

However, critics of Khan often attribute Figma’s success to its innovative capabilities rather than regulatory actions. Dan Ives, an analyst at Wedbush Securities, told Business Insider, “Figma is an outstanding success, but it comes from the company’s innovative advancement, not from the FTC or Khan.”