With a $1.2B IPO, Don’t Miss This Red-Hot New Tech Stock on the Block

30‑Second Take

Why now? The largest VC-backed IPO to happen on American soil in years, Figma began to write the latest chapter in its 13-year history yesterday (Thursday, July 31) with the opening bell on Wall Street.

The design platform has become one of the most eagerly awaited IPOs of the year, with a huge buzz building around the San Francisco-based firm.

It raised $1.2 billion and debuted ahead of expectations at $33.00. The initial range was $25.00 - $28.00.

Snapshot Table

What Makes this IPO Stand Out in a Year of Hot Tech Launches?

2025 has become a banner year for tech launches as investor appetite for the sector sharpens.

Emboldened by interest in AI and quantum tech, names like Circle and CoreWeave have unleashed extensive listings and backed up their initial promise with solid progress. 

So, what makes this IPO stand out? Key to Figma’s appeal is the caliber of its product offering. It has dialed in on what its users want and need and then created clear use cases for Figma.

As the tool has evolved, it's made clever use of AI to cover the whole design lifecycle from initial prompt through design, build, and beyond, further expanding its relevance to new teams, new organizations, and new verticals. 

Figma monopolizes its segment, so growth at scale is something it knows all about.

The San Fran firm is going into its launch with a growth-mindset, which makes this a stock well worth watching – especially given the platform is already working to embrace AI rather than see AI-generated designs of the future as a threat to stop.

In an open letter to its community on Thursday, Co-Founder and CEO Dylan Field said that FIG intended to “take every chance to invest in our platform or pursue M&A at scale.”

Bull Case 

Core thesis: Figma is a cloud-based design and collaboration platform that enables teams to build user interfaces and digital products in real time.

It has revolutionized product design with browser-based tools that combine accessibility, speed, and powerful functionality. 

As it begins public trading, Figma is well-positioned to capitalize on the AI boom—integrating intelligent features that automate design, enhance creativity, and streamline workflows.

With a loyal user base, strong network effects, and increasing adoption among enterprise teams, Figma stands out as a vital infrastructure tool for digital creation, making it an appealing long-term bet for investors in the future of work.

Catalysts: Figma has perfected its value proposition over the years, but continues to evolve – with its embrace of AI a case in point. Here are a few of the catalysts we expect to see shaping FIG over the coming months: 

1. AI Feature Expansion: The AI suite is already proving popular with users. Further introduction of advanced AI tools that automate design, generate UI components, or personalize workflows could drive additional user growth and monetization.
   

2. Enterprise Adoption: Continued penetration into large enterprise accounts—especially via bundled team collaboration tools—would boost recurring revenue and margins.
   

3. International and Domestic Expansion: As per Figma's statistics, approximately 85% of Figma's monthly active users in Q4 2024 were located outside the United States, and over 50% of revenue was generated from non-U.S. markets in 2024.
   
   It has already created localizations for Portuguese, Spanish, Japanese, and Korean speakers, indicating there's enormous room for further overseas expansion while also growing the domestic user base. 
   

4. Product Ecosystem Growth: Integrations with third-party dev tools and expanded plugin marketplaces can enhance stickiness and cross-selling potential.
   

5. Strategic Partnerships or M&A: Alliances with platforms like Microsoft or Google could materially affect valuation.
   

6. Developer and Community Growth: A thriving user base and plugin developer community reinforces network effects and long-term defensibility.
   
   This is something Figma already does well, so identifying ways to develop this advantage further could reinforce the growth trajectory.  

Valuation upside: Early trading expectations for FIG place the stock around $90.00 - $100.00, a growth rate of around x3 from its initial offering.

Bear Case 

Key risk: Figma operates in a space dominated by large incumbents like Adobe with deeper pockets, greater resources, and bigger market share.

Meanwhile, startups using generative AI to auto-design interfaces could disrupt Figma’s core advantage.

As a mission-driven company, Figma has historically prioritized growth over profits. Investors may demand clearer margins, especially as interest rates remain high and SaaS multiples compress.

Macro/sector headwinds: While this is a high-growth sector, it isn’t without its challenges. Many companies are cutting or slowing their software spend, especially in design, dev tools, and collaboration platforms.

Budget scrutiny post-COVID and a shift toward cost efficiency could limit Figma’s enterprise sales growth. 

Figma’s success is also tightly tied to cloud infrastructure (e.g., AWS) and browser-based tech.

Any changes in access, pricing, or performance (especially on enterprise accounts) could impact the user experience and, subsequently, margins.

Competitive threat: Adobe attempted to acquire Figma in a $20 billion deal back in 2023. Although that fell apart, Adobe’s aggressive AI integration into Creative Cloud could tempt users away from Figma.

Quick Checklist 

✅ Thesis still valid after today’s close
✅ Volume confirms move above key levels
✅ Catalyst date double-checked (July 31, 2025)

Deep‑Dive Links

• Analyst Ratings and Price Targets

• Short Interest Data

• Company Profile and Investor Relations

That’s all for today’s Everyday Alpha. We’ll have a new pick for you every morning before the market opens, so stay tuned!

Best Regards,
—Noah Zelvis
Everyday Alpha