Figma CEO’s path from school dropout and Thiel fellow to tech billionaire

Mark Zuckerberg will be the most well-known college-dropout-turned-tech-billionaire. Dylan Subject is the most recent, after his design startup Figma soared in its inventory market debut this week.

The 2 entrepreneurs have one thing else in frequent: shut ties to Peter Thiel.

Zuckerberg received his first exterior examine for Fb from Thiel in 2004, quickly earlier than leaving Harvard College to construct his social community in Silicon Valley. Fb went public in 2012, the identical yr that Subject scored a Thiel Fellowship, which supplies cash “to younger individuals who wish to construct new issues as a substitute of sitting in a classroom.” Over 300 folks have been chosen since its inception in 2011.

Subject, now 33, was a part of the second batch of Thiel fellows, a bunch of 20 entrepreneurs who every took residence $100,000. This system doubled that sum earlier this yr. Like Zuckerberg, Subject got here to Thiel from the Ivy League, having spent two and a half years at Brown College in Windfall, Rhode Island.

On Thursday, Figma’s inventory value greater than tripled in its first day of buying and selling on the New York Inventory Trade. It rose once more on Friday, wrapping up the week with a completely diluted market cap above $71 billion. Subject’s stake is value about $6.6 billion. Zuckerberg, in the meantime, is now the world’s third-richest individual, with a internet value of over $260 billion.

Whereas the contours of Subject’s story might sound acquainted, he is a really totally different type of character.

“Dylan is, by far, essentially the most humble billionaire I’ve ever met,” mentioned Joshua Browder, CEO of authorized providers startup DoNotPay and a former Thiel fellow.

Mike Gibson, who used to assist run the fellows program as vice chairman for grants on the nonprofit Thiel Basis, contrasts Subject with one other tech luminary.

“He is type of just like the anti-Steve Jobs,” mentioned Gibson, a co-founder of 1517 Fund, a enterprise agency that prides itself on investing in dropouts. “Relating to Jobs’ legend as this hard-charging a–hole, Dylan is the alternative.”

The Apple co-founder, who dropped out of school after one semester, died of most cancers in 2011, as his firm was on its strategy to turning into essentially the most invaluable enterprise on the planet.

Subject was poised to formally enter the billionaire ranks virtually three years in the past. With Figma having emerged as a frontrunner in web-based instruments for designing apps and web sites, Adobe agreed to snap up its budding rival for $20 billion. However regulators within the U.Okay. mentioned the tie-up would’ve damage competitors, and the businesses scrapped the transaction in late 2023. Adobe payed Figma a $1 billion breakup price.

Figma’s IPO this week represented not solely an enormous valuation markup for the corporate but in addition served as a banner occasion for Silicon Valley, which has seen a dearth of high-profile IPOs because the market cratered in early 2022 as a result of hovering inflation and rising rates of interest.

“An important factor to remind myself of, the workforce of, is share value is a second in time,” Subject informed CNBC’s “Squawk Field” on Thursday. “We’ll see all types of conduct most likely at present, over the weeks forward.”

Figma declined to make Subject out there for an interview for this story.

Subject’s trek again to the Bay Space, the place he’d grown up, started with a TechCrunch article concerning the fellowship. He submitted his software two hours earlier than the deadline, on New 12 months’s Eve of 2011, whereas he was a junior at Brown. He unnoticed his SAT scores.

“It’s my perception that the SAT is a poor reflection of aptitude and might simply be gamed,” he wrote in his software, which he posted on LinkedIn years later. Within the essay part, he was requested to supply a extremely controversial take.

“Chocolate is repulsive,” he wrote. “Even the odor of it makes me wish to vomit.” 

In response to a query about how he was going to alter the world, Subject mentioned he was going to construct higher software program for drones, and that he would “cofound an organization with the neatest programmer I do know and work on this drawback.”

That co-founder was Evan Wallace, who had been a instructing assistant for a few of Subject’s programs at Brown. Wallace was technologically gifted, incomes the nickname “pc Jesus,” or CJ. However he was already 20, that means he was too outdated to be eligible for a Thiel Fellowship.

Subject scored the $100,000 from Thiel, and shared it with Wallace, convincing him to depart his tutorial pursuits. The pair moved right into a small condominium in Palo Alto, California.

The drone software program plan had gone out the window. Wallace wished to develop one thing associated to WebGL, a graphics rendering system for net browsers. A yr later, they have been displaying traders a slick browser-based demo that allowed for the motion of a ball in a pool of water.

The plain aggressive goal was Adobe, which was ending improvement of Fireworks, an app design product that it acquired with the 2005 Macromedia buy.

“We thought, ‘Wait, perhaps there’s a chance right here,'” Subject mentioned on a podcast earlier this yr.

“What we’re making an attempt to do is make it in order that anybody may be inventive, by creating free, easy inventive instruments within the browser,” Subject mentioned in a 2012 interview for a CNBC particular on the Thiel Fellowship.

In 2013, the founders began speaking with traders about elevating a seed spherical. Subject confirmed the pool water demo to John Lilly of Greylock Companions at a Starbucks in Palo Alto. Lilly had beforehand been CEO of Mozilla, the place an engineer developed software program that led to WebGL. He was impressed with what he was seeing, however he did not suppose it had a lot financial potential.

Figma took on seed funding from Index Ventures and different traders. The founders assembled a small group of workers at an workplace in Palo Alto. Progress was sluggish. Early variations of the product did not impress potential customers. Subject was micromanaging.

When Figma would present the product to corporations within the Bay Space, reception wasn’t at all times nice. Stress was constructing. Lilly, who ended up main Figma’s Collection A spherical in 2014, got here to the corporate’s San Francisco headquarters the next August as struggles have been mounting. Staff wished modifications.

“We each heard it,” mentioned Danny Rimer, the Index associate who led the seed funding, referring to conversations he and Lilly have been having with staffers about Subject.

“We sat down with him and defined to him the state of affairs,” Rimer mentioned. “We heard it and we form of mentioned, ‘Look, that is an deadlock. You are going to should adapt and alter.’ And he heard it and he modified. I feel that is such an important character trait of Dylan, is to listen to the knowledge, be goal about it, course of it and settle for it and act accordingly, if it is smart.”

Round that point, Sho Kuwamoto joined the corporate. Kuwamoto introduced with him expertise from Macromedia and Adobe. 4 months later, Figma launched its debut product in a free preview.

Subject received concerned with customers. He replied to folks on social media who have been posting about Figma, telling them they have been receiving entry to the preview. He additionally sought out outstanding designers.

Firms like Coda and Uber turned early adopters. Some designers have been excited by the concept of sharing paperwork by copying and pasting a URL, as a substitute of getting to cope with variations, codecs and updates. Figma operated within the cloud, offering all the required computing infrastructure, so customers did not want their very own highly effective graphics playing cards.

It wasn’t till September 2016 that Figma made the design editor out there without cost to most people and made it doable for a number of designers to make modifications in a single file concurrently. That turned the killer function.

The software program began gaining traction inside Microsoft. However there was a difficulty. Microsoft feared that Figma’s lack of a transparent enterprise mannequin may result in a burial within the startup graveyard. Jon Friedman, a design government on the software program big, visited Figma’s headquarters to ship the message, Subject informed CNBC in 2022.

“Look, we’re all anxious you are going to die as an organization,” Subject recalled Friedman telling him.

The next yr, Figma launched its first paid tier.

By the point enterprise stalwart Sequoia Capital got here on board in 2019, Figma was a sizzling commodity, elevating its Collection C spherical at a $440 million valuation. Sequoia associate Andrew Reed mentioned a few of his agency’s portfolio corporations had began migrating to Figma, and founders have been utilizing it for pitch decks.

“Firms usually will present prototypes in board conferences of recent merchandise they wish to construct, and so the very first thing we noticed a whole lot of Figma hyperlinks for was that,” Reed mentioned in an interview this week.

“It was an easy funding,” Reed mentioned. “We went by a few of our outdated funding voting information. I feel Figma might need been the very best vote we ever had for an funding.”

Sequoia’s in depth roster of winners over the a long time contains Apple, Google, LinkedIn, Zoom and WhatsApp.

Monetary analysts masking Adobe began asking about Figma. Adobe, which had launched the XD app for person expertise design, responded, including the startup to its official listing of rivals.

However Adobe’s market capitalization sat above $170 billion, and Figma wasn’t even a “unicorn,” a standing reserved for startups value not less than $1 billion. Subject informed Forbes that some job candidates have been hesitant to affix due to the modest valuation. In 2020, the corporate raised a funding spherical from Andreessen Horowitz at a $2 billion valuation.

Then got here Covid. Places of work closed. The world went distant in a single day. Figma’s collaboration functionality all of a sudden turned important to the best way many extra folks labored.

“We requested ourselves: how can we assist groups join, have enjoyable and enter a movement state throughout the earliest levels of the design course of?” Subject later wrote on Twitter.

The end result was FigJam, a digital whiteboard that turned Figma’s second product, and represented a key step towards diversification.

The Adobe noise continued to get louder. In 2020, Subject had discussions with Adobe government Scott Belsky a few partnership or acquisition, however Subject selected to remain the course. Adobe CEO Shantanu Narayen talked to Subject a few doable deal in early 2021, however once more the Figma CEO demurred, opting to lift a spherical at a $10 billion valuation.

“Our objective is to be Figma not Adobe,” Subject wrote in a 2021 tweet.

The atmosphere shortly modified. By early 2022, with the Fed lifting rates of interest to battle inflation, traders have been promoting out of high-growth tech and rotating into companies with predictable income. Sequoia was encouraging its startups to scale back prices.

Belsky once more approached Subject in April of that yr, this time alongside David Wadhwani, who was main Adobe’s digital media enterprise.

“Mr. Subject expressed openness to understanding the phrases of a possible acquisition of Figma by Adobe, and Mr. Subject, Mr. Belsky and Mr. Wadhwani continued their dialogue of the potential advantages of a mix the next week,” Adobe said in a regulatory submitting.

Subject was contemplating the implications of the rise of synthetic intelligence.

“Look, after we did the cope with Adobe within the first place, my head house in 2022 was, “Oh my god, AI is coming. That is clearly exponential as a know-how. I do not know what this does to us. Is that this one-tenth our market, is it 10x our market? What does it imply for creatives and designers?” Subject mentioned in an interview with The Verge final yr. “And I used to be like, it is higher to workforce up on this world with Adobe and to navigate this collectively and to determine this out collectively than it’s to go it alone.”

In September 2022, Adobe agreed to purchase Figma for about $20 billion, asserting that Subject would stay in control of his a part of the enterprise and would report back to Wadhwani.

“Adobe has a singular alternative to usher in a world of collaborative creativity,” Narayen informed analysts on a convention name the day of the settlement. “In my conversations with Dylan at Figma, it turned abundantly clear that collectively we might speed up this new imaginative and prescient, delivering nice worth to our clients and shareholders.”

That chance by no means got here. An intensifying regulatory atmosphere within the U.S. and Europe had made sizable tech offers extra burdensome. Adobe was all of a sudden within the crosshairs, and the transaction was hitting repeated hurdles.

“We’re anxious this deal might stifle innovation and result in larger prices for corporations that depend on Figma and Adobe’s digital instruments — as they stop to compete to offer clients with new and higher merchandise,” Sorcha O’Carroll, an official on the U.Okay. Competitors and Markets Authority, mentioned in a press launch in mid-2023.

Round that point, Subject introduced one other step towards product diversification by introducing Dev Mode, which turns Figma designs into supply code that may function a place to begin for software program builders. The reveal got here at Figma’s Config person convention in San Francisco, which attracted 8,000 attendees.

The U.Okay.’s investigation dragged on for months. Subject was pulling double obligation working the corporate and interesting with regulators. Adobe had mentioned it anticipated to finish the deal in 2023, however time was working out. Regulators have been proposing treatments that the events did not like.

“Even towards the ultimate months, there have been these moments of, ‘Oh, that is going to undergo,’ and moments of, ‘F—, what are we doing?'” Subject informed The Verge. “And clearly on the finish, there is a mutual understanding of,’ This determination has been made for us and let’s name it.'”

On a Sunday in December 2023, Subject gathered board members for a 10-minute name, informing them that the deal was off. The official assertion adopted early on Monday morning.

“It is irritating and unhappy that we’re not capable of full this,” Subject informed The New York Occasions.

Not everybody in Subject’s orbit noticed it that approach. Grammarly CEO Shishir Mehrotra, a good friend of Subject’s and longtime Figma person, mentioned the entire ordeal was having an influence.

“You may see it in his face,” Mehrotra mentioned of Subject, including that he was relieved when he discovered Figma would stay unbiased. “He was getting older proper in entrance of us.”

However Figma had some enterprise considerations. Its internet greenback retention price, a measurement of the corporate’s means to promote extra to present clients, slid from 159% within the first quarter of 2023 to 122% by the top of the yr, in keeping with Figma’s IPO prospectus. Figma chalked it as much as a troublesome comparability from the yr earlier than, due to the launch of FigJam, and financial uncertainty that prompted some shoppers to scale back seat counts. The retention price bounced again to 132% within the first quarter of 2025.

In the course of the 2023 winter holidays, Subject thought of methods to rally the workforce. After the brand new yr, he introduced internally that Figma would give additional fairness to workers who joined or acquired promotions following the acquisition announcement, as a result of the valuation was going again right down to $10 billion. He mentioned any workers who wished to depart would get three months of severance, with no arduous emotions.

Fewer than 5% of staffers took him up on the supply.

As Figma pursues a go-it-alone technique, it faces an existential query: Is the corporate prepared for a future dominated by AI?

In Could, Subject took the stage at Figma’s person convention earlier than 8,500 attendees at San Francisco’s Moscone Middle, sporting a black “Config 2025” T-shirt. He walked the group by a slew of recent merchandise, together with Figma Make, which pulls on Claude 3.7 Sonnet, a big language mannequin from AI startup Anthropic.

“With Figma Make, you may take an present design and immediate your strategy to a completely coded prototype,” Subject mentioned.

A product supervisor, Holly Li, got here up for a demo. At a laptop computer, she copied the design for a music participant within the Figma editor and pasted it right into a chat field, typing directions to rotate the album artwork like a file whereas a music is taking part in. She confirmed apps created with Figma Make, eliciting some cheers, and returned to the demo.

“Okay. This time, the mannequin had a bit of little bit of problem, however that is okay,” she mentioned. The cloudy background picture from the unique design was gone, and monitor names turned troublesome to learn. The gang was silent. She introduced up a working model in a distinct browser tab.

The function went dwell final week. Mehrotra mentioned it is off to begin.

Different merchandise available in the market have been constructed with generative AI in thoughts. They embrace Lovable, Miro’s Uizard and Vercel’s v0. Brent Stewart, an analyst at Gartner, mentioned that Figma is “totally, totally dominant” in design however that among the choices from different corporations look extra spectacular.

Andrew Chan, a former Figma software program engineer, wrote in a weblog put up final yr that “an fascinating and ongoing query is whether or not Figma can repeat the success it had in design with different merchandise.”

Nadia Eldeib, a former Lyft product supervisor and CEO of startup CodeYam, tried Figma Make earlier than the broad launch and put it up towards Lovable and v0. Writing on Substack, she mentioned it gave the impression to be at an earlier stage.

It is the form of suggestions that Subject will learn and ship to his workers, often known as Figmates. He reads help tickets and mentions of Figma’s title on X, previously Twitter. He took no day off to handle such issues on the very day that his firm was conducting its IPO, finally pricing shares $1 above the anticipated vary.

Yianni Mathioudakis, a inventive director in Maryland, tagged Figma in a put up on Wednesday, asking if anybody had discovered a strategy to take a Figma Make design and produce it into the principle design editor.

“Hello Yianni, we’re working in the direction of this and really enthusiastic about what it’s going to unlock!” Subject replied. “Please hold the Make suggestions coming!”

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