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“Startup Exits in Jeopardy: Adobe’s Abandonment of Figma Acquisition Raises Concerns About Regulatory Impact on the Tech Industry”
In a surprising turn of events, Adobe has called off its $20 billion acquisition of Figma, citing regulatory concerns in the EU and the United Kingdom. This latest development has sparked worries among venture capitalists and founders, who fear that stricter government regulations could have a negative impact on startup exits.
The cancellation of Visa’s acquisition of Plaid in 2020 and the appointment of Lina Khan, a renowned antitrust researcher, to the Federal Trade Commission in 2021, have only heightened concerns about regulatory hurdles in the tech industry. The Adobe-Figma breakup has further fueled discussions on how this could affect startup liquidity and the future of large startup acquisitions.
Despite these concerns, a closer look at the startup M&A landscape suggests that the sentiment may be more fear-mongering than a true reflection of the market. The reality is that the majority of startup deals are not comparable to the Figma or Plaid situations, and there is still plenty of opportunity for successful exits in the industry.
