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>And that Lina Khan should stay off this? Give me a break, this is exactly what she should be targeting if she is serious about antitrust. Adobe + Figma bundle

by jasode 4y ago

>And that Lina Khan should stay off this? Give me a break, this is exactly what she should be targeting if she is serious about antitrust. Adobe + Figma bundle destroys this market for anything not named Canva for at least 5-6 years. But the concept of "market competition" isn't just something outsider observers like us can judge and say -- "Yes, we conclude that this Figma acquisition is anti-competitive." True genuine competition also depends the actual founders' internal motivations and future plans -- which we can't see. In other words, there isn't any competition if the co-founders don't want to compete anymore. Humans have complex motivations and the FTC can't make them compete if they don't really want to. Figma wasn't making profits yet. Yes, they were growing the revenue but every founder has different thresholds of fighting on vs selling. For example of genuine competition, consider that Mark Zuckerberg said "no" to Yahoo's offer of $1 billion. He also said "no" to Microsoft's buyout offer of $15 billion. MZ valued his company more than Yahoo and Microsoft did, so "no" made sense to him. Did founders Dylan Field and Evan Wallace have see their Figma company staying independent the same way? I guess not because they said "yes" to Adobe's $20 billion. >The idea that FTC should reward innovation by allowing monopolistic/oligopolistic buyouts for big prices As for the "innovation" paradox, what the blog author was trying to explain is that Figma never would have gotten this big unless the original VC investors saw a future possible acquisition by Adobe/Autodesk/Microsoft/etc. More startups get acquired than actually go all the way to IPO. Without the option of "Adobe might buy them later so we can get our investment money back", Figma never even becomes Adobe competition because they never got the $332 million in funding in the first place. If Figma was a bigger publicly held company with other multiple powerful shareholders besides Dylan and Evan, that would make more sense for FTC to block the transaction because other owners+managers within that hypothetical company may really want Figma to "compete". If startup cofounders really don't want to compete anymore, FTC can't do much about that.

CPLX 4y ago
> True genuine competition also depends the actual founders' internal motivations and future plans -- which we can't see. In other words, there isn't any competition if the co-founders don't want to compete anymore. Humans have complex motivations and the FTC can't make them compete if they don't really want to. Any citations for this extremely novel legal theory?
- deleted 4y ago
  [deleted]
- jasode 4y ago
  >Any citations for this extremely novel legal theory? My point is that human emotions, passion, and endurance to withstand the stress of running a startup -- cannot be mandated by the FTC. That's not a legal theory that requires any cites. If the founders don't want to mentally "stay in the game" to compete... that means there really isn't competition that we're hoping for. Founders are humans and not robots with a simple "compete" switch that the FTC can just flip on. If you disagree and think the FTC can force founders to do what they really don't want to do, explain how? Blocking this Adobe's transaction doesn't force cofounders to compete. They can still "sell" Figma in many ways besides a straight acquisition. Just more hoops to jump. Exclusive technology licensing to Adobe, or joint ventures, etc. Those would be a legal quasi "acquisition" by another name. The creative ways to structure "strategic business partnerships" are made possible because the founders would rather get some monetary reward instead of continuing to compete with Adobe. Ok, outside observers like us can all pound the table saying "Figma should stay independent so there's competition for Adobe!" But... if the founders have mentally quit and don't want to compete, now what? See the problem?
  - CPLX 4y ago
    You’re talking about a company with around a hundred million dollars in revenue. The founders can quit if they want, they can join the circus who fucking cares? The corporation is a distinct legal entity it can hire someone else. None of this has anything to do with the fact that monopolies are destroying society and the FTC has a mandate to stop them.
    - jasode 4y ago
      >The founders can quit if they want, they can join the circus who fucking cares? The corporation is a distinct legal entity it can hire someone else. But again, it's not a "distinct legal entity" that's competing that you can just assume as a given. You still need the people behind that entity with the state of mind to really want to compete. Focus on the human actors .... If the other shareholders on the Board of Directors would rather sell their Figma ownership to Adobe to go along with founders Dylan & Evan selling -- instead of hiring new managers to replace them to continue trying to compete with Adobe, then there is no underlying competition there for the FTC to try and preserve. Again, true competition requires motivation from the founders and the Board of Directors to actually want to compete. The VCs in multiple rounds invested millions specifically in Dylan & Evan -- and not random hired managers -- to run Figma. They'd rather not hire replacements because it's too risky. Trying to find some hired guns that inevitably have less passion and energy than the original founders -- makes Figma less competitive, not more. The thinking is similar for Adobe as the buyer. For them, the acquisition terms would have to include Dylan & Evan as "key people" joining Adobe as vice presidents for some years to keep improving Figma (or merging it with Adobe XD, etc) while their Adobe stock compensation vests.

by jasode 4y ago

CPLX 4y ago

> True genuine competition also depends the actual founders' internal motivations and future plans -- which we can't see. In other words, there isn't any competition if the co-founders don't want to compete anymore. Humans have complex motivations and the FTC can't make them compete if they don't really want to. Any citations for this extremely novel legal theory?

deleted 4y ago
[deleted]
jasode 4y ago
>Any citations for this extremely novel legal theory? My point is that human emotions, passion, and endurance to withstand the stress of running a startup -- cannot be mandated by the FTC. That's not a legal theory that requires any cites. If the founders don't want to mentally "stay in the game" to compete... that means there really isn't competition that we're hoping for. Founders are humans and not robots with a simple "compete" switch that the FTC can just flip on. If you disagree and think the FTC can force founders to do what they really don't want to do, explain how? Blocking this Adobe's transaction doesn't force cofounders to compete. They can still "sell" Figma in many ways besides a straight acquisition. Just more hoops to jump. Exclusive technology licensing to Adobe, or joint ventures, etc. Those would be a legal quasi "acquisition" by another name. The creative ways to structure "strategic business partnerships" are made possible because the founders would rather get some monetary reward instead of continuing to compete with Adobe. Ok, outside observers like us can all pound the table saying "Figma should stay independent so there's competition for Adobe!" But... if the founders have mentally quit and don't want to compete, now what? See the problem?
- CPLX 4y ago
  You’re talking about a company with around a hundred million dollars in revenue. The founders can quit if they want, they can join the circus who fucking cares? The corporation is a distinct legal entity it can hire someone else. None of this has anything to do with the fact that monopolies are destroying society and the FTC has a mandate to stop them.
  - jasode 4y ago
    >The founders can quit if they want, they can join the circus who fucking cares? The corporation is a distinct legal entity it can hire someone else. But again, it's not a "distinct legal entity" that's competing that you can just assume as a given. You still need the people behind that entity with the state of mind to really want to compete. Focus on the human actors .... If the other shareholders on the Board of Directors would rather sell their Figma ownership to Adobe to go along with founders Dylan & Evan selling -- instead of hiring new managers to replace them to continue trying to compete with Adobe, then there is no underlying competition there for the FTC to try and preserve. Again, true competition requires motivation from the founders and the Board of Directors to actually want to compete. The VCs in multiple rounds invested millions specifically in Dylan & Evan -- and not random hired managers -- to run Figma. They'd rather not hire replacements because it's too risky. Trying to find some hired guns that inevitably have less passion and energy than the original founders -- makes Figma less competitive, not more. The thinking is similar for Adobe as the buyer. For them, the acquisition terms would have to include Dylan & Evan as "key people" joining Adobe as vice presidents for some years to keep improving Figma (or merging it with Adobe XD, etc) while their Adobe stock compensation vests.