20VC: Figma's IPO: The Full Breakdown | Index Returns $3.5BN on Two Deals | Why Melio's $2.5BN Acquisition is "Discouraging" | Asana's New CEO and the Great Founder Exodus | Oracle's $30BN AI Deal and What it Means for Incumbents
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Insights
🎯 Summary
20VC Podcast Episode Summary: Figma’s IPO, VC Returns, and Market Dynamics
This 71-minute holiday edition of the 20VC podcast features hosts Jason Lemkin, Warrior, and Driscoll discussing several major developments across the tech and venture capital landscape, focusing heavily on public market readiness, VC performance, and strategic acquisitions.
1. Focus Area
The discussion centers on General Tech and Venture Capital dynamics, specifically analyzing recent high-profile company filings (Figma S-1), significant M&A activity (Melio), exceptional VC fund returns (Index Ventures), founder transitions (Asana), and the massive capital expenditure wave driven by AI infrastructure (Oracle’s deal).
2. Key Technical Insights
- AI Mandate for Growth: A strong assertion was made that companies must demonstrate growth driven by AI integration; failure to do so implies a fundamental business failure in the current environment.
- AI CapEx Scale: The current annual capital expenditure on AI infrastructure globally is estimated to be between $300 billion and $400 billion, raising questions about the long-term economic rationality and ROI of these investments.
- Figma’s Product Pervasiveness: Figma’s S-1 highlights that its user base extends significantly beyond designers, with 30% of users being developers, underscoring its evolution into a pervasive software development tool, not just a design tool.
3. Market/Investment Angle
- Figma Valuation Context: Despite Figma’s strong metrics (46% YoY growth, positive EBITDA/FCF, Rule of 80+ performance), its potential $20B+ IPO valuation is scrutinized against established enterprise giants like ServiceNow, which trade at lower multiples (20x current revenue is considered high).
- Index Ventures’ Exceptional Returns: Index Ventures is highlighted for returning $3.5 billion to LPs in a short period via two major exits (Scale and another deal, implied to be related to Figma/Stablecoin), demonstrating the power of backing “fewer, bigger winners.”
- The Concentration Trend: The market is showing a trend toward fewer, but significantly larger winners (due to longer holding periods), meaning early investors in these outliers realize massive, multi-billion dollar returns, challenging previous expectations for exit sizes.
4. Notable Companies/People
- Figma: Detailed analysis of its S-1, strong financials, and the strategic wisdom of Adobe’s failed acquisition attempt (which would now look like a good deal).
- Index Ventures: Praised for achieving massive liquidity returns, positioning them alongside Founders Fund as firms capable of delivering such results on large funds.
- Adobe: Discussed for its strategic foresight in attempting to acquire Figma, which would have been a central plank in its enterprise/developer strategy.
- Melio: Its $2.5 billion acquisition was deemed “discouraging,” likely in the context of the broader market correction or the specific terms/timing.
- Asana: Mentioned in the context of a “Great Founder Exodus” following the appointment of a new CEO.
- Oracle: Mentioned in relation to its $30 billion AI deal, signaling the massive infrastructure commitments being made by incumbents.
5. Regulatory/Policy Discussion
No specific regulatory or policy discussions were detailed in the provided excerpt, though the context of IPOs (S-1 filing) implies SEC oversight.
6. Future Implications
The conversation suggests that the venture landscape is bifurcating:
- Massive Capital Return: Funds that backed the current generation of winners will see unprecedented liquidity, fueling future VC investment.
- The Winner-Take-All Effect: The trend toward fewer, larger winners means the skill of picking the right deals is more critical than ever, as smaller winners no longer provide sufficient fund returns.
- Founder/VC Relationship Endurance: There is a deep dive into the challenges of “orphaned” portfolio companies when a champion partner leaves a VC firm, emphasizing that board members must have current influence over capital allocation to remain useful.
7. Target Audience
This episode is highly valuable for Venture Capital professionals (GPs/LPs), Founders of high-growth SaaS/Enterprise companies, and Technology Investors seeking deep analysis on public market readiness, M&A strategy, and fund performance benchmarks.
🏢 Companies Mentioned
And Clio
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Jack Newton
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Sam Lesson
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As I
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Goals Platinum
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Computer Associates
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My Grammarly
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Saster Annual
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Bending Spoons
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Robert Smith
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Brian Shate
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And Jason
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Manifold I
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Warren Buffett
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Sometimes I
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💬 Key Insights
"if Oracle can get AI native by June 30th and you're powerful, your startup can't, I mean, I'll smile, but I give up."
"But the ones in our portfolio that haven't really, they're still talking about it. I've given up on them. They had their time."
"Mine's pretty simple. It's like for the vast majority, I want the AI native except for the exceptional product builder, the genuine needs like a dad's trainer."
"I think the thing that I just think about as like being AI native is such an advantage. We are in a company that is similar to Superhuman that will be at more than their revenue in nine months for what it took them eight years to go to."
"Growth is exactly the same as it was 12 months ago just about when you throw them in. So I know we're not like we are stealing budget from each other. And yes, sure, our CIO's adding an AI budget or this and that, but it's net zero. We've learned it's net zero at this point, right?"
"If you didn't get it done in these 18 or 20 months, you ain't ever getting it, it ain't going to happen."
📊 Topics
#artificialintelligence
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#startup
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#investment
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#generativeai
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