INDONESIAKININEWS.COM - Figma established itself as an anti-Adobe. The company even has a web page dedicated to the excellence of Figma pr...
He really had no choice. Adobe was visibly struggling after it misread the market and had to make a desperate bid for growth. And when a company backs up a dump truck of cash that size to your doorstep — with reportedly no rival suitors around, no less — you say yes.
Now, with Figma set to become an “autonomous unit” within Adobe — one that doesn't even report directly to the CEO — and Adobe signaling it will seek to move its products onto Figma's cloud platform, all eyes are on Canva as the biggest roadblock to a total Adobe takeover.
“Whether or not Canva exists … this is something that, for the future, Adobe would have had to do,” Griffin Securities managing director Jay Vleeschhouwer told Protocol. “The question is: What is it about the Figma platform that makes so much sense for them to do it this way?”
The Australia-based private design startup is gaining notable traction with businesses. In a sign of its growing prevalence, the company was last valued at $40 billion, according to PitchBook, compared to Figma's estimated worth of $10 billion at the time of the deal. Canva's private valuation, however, has likely dropped amid a wider market downturn.
In contrast to Figma, Canva's product suite seems much more targeted at Adobe's biggest money-makers, namely Photoshop. You just don't need weeks to learn Canva's program. And, unlike Figma, Canva doesn't seem to have any hesitation about going head-to-head with Adobe. For example, the company allows users to edit PDFs directly, one of Adobe's signature creations.
What's frustrating about the Figma acquisition is Field had Adobe on the ropes. For the first time in decades, it appeared that users were finally going to benefit from greater competition in a sector long stuck in a one-vendor chokehold. That was of growing importance given the industry is poised for growth as more businesses look to give employees of all stripes access to design tools.
Now it's on Canva to try to battle Adobe. But Canva's market potential is limited by the fact that most professional designers aren't going to switch to Canva. Still, the demand for easy-to-use design software appears to be growing. And it's another area where Adobe is rushing to catch up.
Design software for all
The biggest risk for Canva is trying to do too much too fast, especially after the Figma deal.
The company recently launched a new word-processing product, along with enhanced collaboration tools. While that’s an industry segment that would also benefit from additional competition, it means Canva is taking on three of the sector's biggest names: Microsoft, Adobe and Google.
Notably, Canva is missing email, an important pillar of most office software packages that Microsoft, and increasing Google, sell. That means Canva is banking on large businesses being willing to buy such services separately, which would seem to be a major departure from the current purchasing model for most corporations. And Canva isn't the only one that senses an opportunity to try to chip away at Microsoft's dominance and Google's growing presence in core employee software: Zoom is reportedly set to launch its own email and calendar tools.
Still, Canva's strength lies in its grassroot adoption. If the company can replicate the success it’s had with individual users with the central IT department, Canva could prove irksome for Microsoft and Google. However, momentum would need to be big for a business to completely switch off Outlook. But design software isn’t as entrenched within companies. And from a user perspective, Adobe needs competition after years of angering customers by capitalizing on its stronghold over the industry.
Adobe made its money making design a specialized field. If you wanted to be a designer, you learned Adobe's products. And with a vast enterprise business, those who landed a job post-college were likely to continue using Adobe every day of their professional lives. Like an Oracle database, most have to be trained on Photoshop or InDesign to get the full functionality. And like Oracle, Adobe gravely misunderstood the trajectory of the industry and the growing appetite for tools that are much easier to adopt and use.
A vast array of users — marketers, social media influencers, Wall Street analysts and small businesses owners, for example — want to do the design work themselves without having to master a complicated program chock-full of features they have no use for. For many, Adobe has the reputation of simply being too geared toward professional users, and too expensive as a result.
It’s why the company recently launched Adobe Express, its competitor to Canva. And while Figma is expected to top $400 million in annual recurring revenue by the end of this year, rival product Adobe XD has struggled because “it didn’t have great product market fit,” according to Adobe Chief Financial Officer Dan Durn.
Adobe isn’t the only tech boomer rushing to meet the new demands of hybrid work. Autodesk — which, like Adobe in design, has a stronghold over the market for engineering and architecture software — is also spending big to infuse new collaboration features into its signature products.
“We are targeting what needed to happen as it related to screen design with the desktop product. I think the much newer market that emerged, which Figma effectively both addressed and pioneered, was the ability to do this in a collaborative way,” Adobe CEO Shantanu Narayen told investors.
But Adobe is clearly facing a much more dire threat: A company doesn’t offer 50-times revenue in an economic downturn unless the situation is bleak. It’s proof that users want more options than Adobe, a company that has a checkered history with customers who complain about price increases and the lack of product innovation. But it’s also proof that demand could be slowing, which means competition will only intensify.
"Adobe does not take its market leadership for granted. It's the culture that goes back to the founding," said Vleeschhouwer.
With Figma gone, it’s now a two-horse race. That’s still bad news for Adobe, which is not used to any sort of competition. But it’s a consolation prize for those users decrying the pending Adobe takeover of Figma.
Source: protocol
