The Figma Product Growth Strategy
+ PM Job Red Flags 🚩
How Figma went from 0 to $20B in 10 years:
Bringing collaboration to design
Product-led growth motion
Building super premium tiers
Successfully launching a new product
Presenting an existential threat
At $20B, Figma is worth more than many household names: Spotify, Snapchat, Expedia, Coinbase, Pinterest…
It’s quite the triumph for the B2B SaaS company. For product growth enthusiasts, its case is a must study:
1. Bringing collaboration to design
Photoshop speaks “file.” Everything is designed around the PSD file. To ensure backwards compatibility, Photoshop has never been able to move away from it. This makes layering collaboration on top of Photoshop nearly impossible technically.
For design software, this has been a big problem. Design is inherently collaborative! Especially product design. Figma brings collaboration to design. It’s “Photoshop in a browser.” This is why >1/2 of Figma’s users are PMs, analysts, & folks in the product design process.
2. Product-led growth motion
Figma is completely free for individuals & students. This generates a huge top of the funnel. Students and solopreneurs get hooked on free Figma. Then, when they become professionals and companies, they move to paid.
This is the classic PLG motion:
· Free
· Disruptive functionality
· Focused on a specific user type
You start at the bottom end of the market. Then, you move upmarket. Figma’s hockeystick in revenue happened post 2018, as it deployed sales teams to land big accounts.
3. Building super premium tiers
Figma has 4 pricing tiers: Free, $12, $45, and $75. All per editor, per month. The $12 version - Professional - is quite good. It’s perfect for cash-strapped startups.
But, the other tiers somehow are also compelling. For instance, have a big design team? Move up to $45 for org-wide libraries. Want advanced security? Move up to $75. Coming up with compelling products at every tier is usually the hard part. Figma has figured it out.
4. Successfully launching a new product
Launching a new product is super tough. Very few companies succeed. But, Figma has succeeded with FigJam.
It moved into a totally new market, brainstorming software. So, it went from competing with Canva & Photoshop to Miro & Invision. And it managed to take a bite out of the new competitors’ market.
The succesful launch speaks to Figma’s remarkable system. Some companies are built to accommodate longer term growth. Figma has the signs that it’s one.
5. Presenting an existential threat
To get to $20B on $400M ARR, Figma commanded a 50x multiple. That’s far higher than comparable public B2B SaaS comps. Snowflake is at 22x.
Figma was able to command such a premium because it presents an existential threat to Adobe. In a space as collaborative as design, it was able to build the premier collaborative product.
For 10% of its market cap, Adobe was able to buy its biggest threat.
PM Job Red Flags
There are 424,156 open product manager jobs on LinkedIn.
Not all are created equal. 11 PM job red flags:
1. Mention of SAFe
The Scaled Agile Framework is a mess. It’s generally implemented at companies without strong product cultures. There’s often lots of Agile coaches and delivery leads around who have never worked in empowered product teams.
2. Hiring for a product owner
There’s some stealthy “product management” postings which are actually hiring for a product owner. This is usually hiring for some sort of PM-lite position. It’s often part of a “similar to SAFe” transformation of an old-school tech organization.
3. Don’t control roadmap
When the posting says you need to “influence” the actual people who control the roadmap. This is often a situation where sales or executives own the roadmap. PMs become the cross-functional coordinators of building someone else’s ideas.
4. No engineering team
If the job posting has nothing about working with engineering, it’s a product strategy job in disguise. There’s been a proliferation of these pontification jobs disconnected from actually shipping features regularly.
5. Heavy focus on process
If the job requirement is all about managing JIRA, taking notes, and process, it signals weak product culture. Often, the PMs are mainly glue in an engineering or sales driven culture. Being a “process person” is far from empowered product management.
6. Job tasks include maintaining JIRA
JIRA is just a tool for managing tasks. While PMs might be involved in creation of JIRAs, they shouldn’t be JIRA monkeys. In empowered product teams, PMs spend just a little bit of time in JIRA. It’s not a major job responsibility.
7. Heavy focus on technical skills
The PM jobs where there is a requirement for a Masters in CS are often “Engineering Manager-lite” jobs. While some technical experience and skills are required for technical products, not more than an engineer.
8. Mention of a yearly roadmap
Yearly product planning is a sign of a waterfall product development process. PMs and developers become part of the “feature factory” executing on features prioritized 9 months ago. The best teams rapidly react to new information.
9. Focus on number of features shipped
If the posting is all about shipping features, that’s a good sign you’re about to walk into a feature factory. The number of features is less important than impact, but many product orgs emphasize quantity.
10. Requirement to QA
Postings that emphasize QA and UAT are likely heavily subordinate PM jobs. It usually signifies developers run the show and PMs help their releases.
11. No mention of vision or strategy
If the posting is all about roadmaps and features, you are not on an empowered team. For empowered PMs, strategy and vision are key parts of the job.
Bonus: Rules that Make me a Better PM
14 rules that make me a better PM (and should work for you too):
Rule: Put the User First
When it comes to tradeoffs, put the user above the business. In the long run, it helps the business.
Rule: Find the Expert
As a jack of everything but master of none, find the experts. Then shamelessly run with their best ideas.
Rule: Keep Asking Why
There is almost always another why behind the why. Keep finding it.
Rule: Don’t Use More Words When Less Will Do
Always choose concise and simple communication over complex. This applies to meetings and docs.
Rule: Regularly Drop the Unnecessary
Find the bits of work and effort that will yield the least value. Tactfully eliminate them.
Rule: Write Everything
Put key strategy, principles, and product requirements in writing. It creates great artifacts.
Rule: Growth Mindset
Keep improving a little bit from every single encounter and action. The growth compounds.
Rule: Find Joy in the Work
It’s easy to pull your hair out with the stress of influence. Find the positive.
Rule: Value Building the Right Thing Over Being Right
Often times, we are wrong, and our hypotheses disproven. Change your mind quickly.
Rule: Thrive in the Muck
When ownership is hairy and territory thorny, shine. Be the glue.
Rule: Have High Expectations
People, teams, and products rise to the level of their expectations. Keep raising the bar.
Rule: Be an Energizer
When things are going wrong and team’s energy is fading, be the light. Everyone values energy.
Rule: Focus on Impact over Circumstance
Don’t base self worth on circumstances like ownership, team. Focus on impact.
Rule: Be a Great Teammate
Above all, product management is a team sport. Put the team first.
Thanks for sharing your insights!
Loved the information and the writing style.