Figma's IPO Surpasses Expectations, Reaches $120 on Day 1

Transcript

I know that this was a hotly anticipated IPO, but with that being said, are you surprised by just the open arms recession exception that we're seeing today? Honestly, it has exceeded even our expectations, I think, on how well this would go. It's fantastic to see. I mean, Figma is an incredible company, as everybody well knows by this point in time. And I think there was a lot of excitement and anticipation around what would happen today. It's even higher than I expected it to come out. And, and Congrats to Dylan and the whole Figma team. Yeah, I think a lot of folks are surprised by some of the numbers that we're seeing right now. And of course, the natural question that follows is what does this mean for the other companies? In the pipeline right now, that has been the question when we're going to see a really robust return to maybe some more normal levels. We're starting to get there. But in IPO like this, Eric, I have to imagine that that helps some of these companies law. I think it does. I mean you've had companies like Databricks who have been waiting in the wings for a while, a fantastic business also growing at you know 50% year over year. You know, I think there are 3.7 billion in revenue run rate and you know, they are profitable and as was Figment like you have some flexibility in terms of when you go out. And I think everybody's been waiting to see what would happen in the markets and how circle in this IPO would be received and. Obviously seeing the very positive reception should have a positive impact on, you know, the timing of future IPO's. Yeah, it's kind of, I mean you bring up profitability. I mean there was a lot of talk when this became clear that they would become public that this will be one of the few companies that actually did have profitability, including on a net income basis and more importantly still had a relatively healthy growth rate. And I am here on the revenue side and I am curious about that aspect of it because everyone I spoke to seemed to really focus in on that idea. That the analyst community modeling something like 30 to 40% growth for at least the next couple of years and it's hard to find certainly any software company and certainly not a mature one that can actually compete at that same growth rate. Yeah. I think Palantir is the only other public software company that's growing at that kind of rate. As I mentioned, data breaks has been too. So I think, you know, we're still seeing very, very healthy growth in these private companies that are preparing to go public. And I think as they come to market, we'll see that continue to be the case. These companies have been expertly navigated through the changing AI landscape thus far and I certainly have very high confidence in their executive teams to be able to continue to do so. When you look at the pipeline of potential IPO's, the ones that are in the private space potentially going public, including maybe some of the ones that Red Point has a stake in, what is the quality overall, Erica, of those companies? I think it's exceptionally high and that's part of the reason these companies have been able to remain private for as long as they have. You take Stripe, a red point portfolio company or or data bricks and they have had the luxury of access to capital in the private markets at fantastic terms because they are running exceptionally good businesses. And so they have all the power about when they go out to market and they are going to look to you know the Figma IPO and any others to come. To see how those are received by the market and they're going to go out at their own pace when it makes sense for their business because they really don't need to. Yeah, that's the thing. And to that point, Erica, I wonder if it's your opinion that something fundamental has changed and the way the companies fund themselves. I mean, a stripe doesn't necessarily have to go public. To your point, you think about a SpaceX, which I know is in a portfolio company of yours. That's another company that can get all the funding it needs pretty much in the private markets. Do you think that we have entered a new regime? There are some of these companies are just going to stay private forever. Forever is a very long period of time. I don't have that kind of a crystal ball. I wish I did. But I think they will remain private for longer and longer. And again, they're going to go public at a time that it makes sense for their business. It could be to make a strategic statement to the market. It certainly is a huge win for employees and has a material impact on morale. It can improve access to, you know, the capital markets. Obviously, it gives them more options and so. You know, I think that there are still very good reasons to IPO and we'll see companies do that at at a point that it makes sense for them. I think anything that can be done to smooth the way for that to happen. You know, we do have a pretty intense regulatory environment and seeing some of those restrictions relaxed potentially and they the the cost of going public come down could have an impact as well on some of these businesses and their choice to do so.