Adobe’s $20 billion Figma deal is an enterprise SaaS power move

The rich eat

After Adobe’s $20 billion deal for Figma, it’s getting harder and harder to see how the current generation of SaaS startups will break the hold that platform companies have on the enterprise software market.

A decade ago, things were quite different: Businesses fed up with older, clunkier enterprise software are excited to bundle together the tools they need to thrive from a variety of disparate vendors. Founded in 2012, Figma rode that wave.

• The company has been a designer’s darling since day one, a web-based tool built for the modern age that made its name because it was easy to use and increased collaboration within creative teams.
• Figma has added other tools and features to expand its usefulness, and has made inroads with some of the world’s largest companies, such as Adobe’s longtime partner Microsoft.
• It’s not hard to imagine that Figma will become a design-forward enterprise software powerhouse in its own right; co-founder and CEO Dylan Field certainly thought so that’s the path his company has been on for the past year.

But two increasingly important factors in enterprise software changed Figma’s course: Platform companies are desperate for growth, and enterprise software buyers are tired of managing dozens of vendors.

• Adobe has played defense throughout the 15-year arc of the cloud and mobile computing era, but it has the inherent advantage of an established enterprise software company: a profitable installed base among the world’s largest software buyers.
• While individual departments within those large companies often have purchasing authority over the tools their teams need to use, there are still many companies where enterprise software is purchased by upper management and imposed on employees. .
• While existing Figma users are concerned about the deal right away, those companies will be excited: They’ll be able to keep their existing relationships with Adobe while offering their design teams a cool-kids tool.

After two years of pandemic-induced growth that raised the fortunes of basically everything in enterprise software, the tide seems to be turning.

• Public and private SaaS valuations have returned to the world, making companies that once relied on stock-based acquisitions targets for acquisitions.
• Enterprise software executives are realizing that they absolutely must become profitable at a certain point, forcing tough choices about where and how they want to compete with larger, more profitable companies like Adobe.
• And the looming threat of a slowdown in enterprise software spending could mean that buyers forced to set spending priorities opt to stick with vendors they’ve always used, who also have the margins to offer long-term discount not necessarily matching startups.

By the time Figma was born, a new distribution channel — the cloud — and the rise of design thinking have turned enterprise software into one of the most competitive technology markets.

• As we’ve mentioned many times over the past two years, the big platforms are making a comeback.

— Tom Krazit (email | nervous)

A MESSAGE FROM CNCF

ArgoCon, which will take place September 16 – 21 in San Francisco and is virtual, will foster collaboration and discussion for audiences at all levels on the Argo Project, which consists of four projects: Argo CD, Argo Workflows, Argo Rollouts, and Argo Events. Register today to learn in person or virtually from practitioners about project pitfalls and best practices.

Register to attend: In person | Virtual

Why enterprise tech feels like the UK

Business technology is often out of sight, out of mind. And although the sector emits as much carbon as the United Kingdom, its carbon emissions tend to fly under the radar. A new McKinsey analysis found today that the sector emits between 350 and 400 megatons of carbon dioxide equivalent gases each year (a measure that standardizes greenhouse gas emissions), or a whopping 1% of all of global emissions.

And data centers aren’t the only ones to blame: The analysis found that personal business technology such as laptops, smartphones and even printers contribute up to twice as much carbon emissions as data centers this. This is due to the large number of end user devices that enterprise companies rely on and the fact that they are replaced more often than servers and are rarely recycled.

But – good news! — options abound for CIOs looking to reduce their emissions, and many of them come at little cost. This includes simply buying less stuff, which can reduce between 50% and 60% of end user device-related emissions, and recycling devices at the end of their life.

The report also says business leaders should establish metrics for “green returns” on technology costs, focusing on the cost per ton of carbon saved as they consider suppliers and manufacturers of technology on which their operations depend. The latter is in some ways the most important: Measuring emissions today makes it easier to cut them tomorrow.

Read the full story here.

– Lisa Martine Jenkins (email | nervous)

Enterprise customer experience

The mandate is clear. Modern businesses need to provide a seamless, technology-enabled, end-to-end customer experience across their organizations: to always be ready, regardless of time or platform, to instantly meet customer needs and provide of human connection. This requires eliminating silos, increasing automation and analytics and ensuring that the front end and the back end are aligned to deliver a positive experience for your customers and your team. But how do you achieve this in today’s digital landscape?

At this virtual Protocol event on Sept. 19, we’ll examine the tech tools and tricks and real-life strategies companies are using to build the CX tech ecosystem and prepare for an increasingly customer-first future. Please join Protocol Enterprise’s Aisha Counts in conversation with Lara Caimi, chief customer officer at ServiceNow; Glenn Weinstein, chief customer officer at Twilio; and Clara Shih, chief executive officer of Service Cloud at Salesforce.

RSVP here.

Around the enterprise

The White House also ordered federal agencies to inventory all the software they use, which can help speed up the response to newly discovered software vulnerabilities.

Google Cloud has introduced a free trial of Cloud Spanner as cloud providers continue to see databases as a key competitive lever: Once data is in, it’s hard to get it out.

A MESSAGE FROM CNCF

ArgoCon, which will take place September 16 – 21 in San Francisco and is virtual, will foster collaboration and discussion for audiences at all levels on the Argo Project, which consists of four projects: Argo CD, Argo Workflows, Argo Rollouts, and Argo Events. Register today to learn in person or virtually from practitioners about project pitfalls and best practices.

Register to attend: In person | Virtual