Shyam Mani (Kleiner Perkins) on Figma | EP 1 pt. 2
Description
In this insightful episode of the UNinvested podcast, host Sahil Seth welcomes Shyam Mani, an investor at Kleiner Perkins. They discuss the exciting acquisition of Figma by Adobe, the significance of the collaboration thesis, and the future of the UI/UX design industry. Shyam shares his experiences and perspectives from both the entrepreneurial and investment sides, providing valuable insights into the venture capital world.
What we explore:
Adobe's acquisition of Figma and its implications
The importance of collaboration tools in the tech industry
Shyam's journey from a student founder to an investor at Kleiner Perkins
The role of Kleiner Perkins in nurturing and supporting startups
The future of the UI/UX design industry
The balance between remote and in-office work in the investment world
Where to find Uninvested:
Website: https://www.uninvested.org/
In this episode, we cover:
[00:00:00] Disclaimer and introduction
[00:00:11] Welcome back to UNinvested podcast
[00:00:17] Recap of Adobe’s acquisition of Figma and introduction of Shyam Mani
[00:00:58] Shyam’s background and experience at Kleiner Perkins
[00:01:21] Hybrid work model at Kleiner Perkins
[00:01:59] Benefits of in-person meetings vs. virtual meetings
[00:02:58] Shyam’s first encounter with Figma at Northwestern
[00:04:07] The significance of Figma’s collaboration tools for student founders
[00:05:25] Kleiner Perkins' early involvement with Figma
[00:06:35] Figma’s journey and its impact on the design industry
[00:07:54] The collaboration thesis and its applications in various industries
[00:09:12] The benefits of Adobe's acquisition of Figma
[00:10:49] Potential challenges and opportunities post-acquisition
[00:12:02] Shyam's perspective on maintaining Figma’s independence within Adobe
[00:13:35] Innovation speed in large firms acquiring startups
[00:14:40] The role of legacy leaders in supporting acquired startups
[00:15:39] The future of the UI/UX design space
[00:17:10] Figma's potential role in low-code and no-code development
[00:18:05] The intertwined relationship between Figma and the design industry
[00:19:10] Shyam’s routine and its evolution over the years
[00:21:01] Closing remarks and gratitude for Shyam’s participation
Disclaimer: All these thoughts and opinions are our own and our guests and do not belong to any entities we're involved in.
Also, keep in mind we are active college students, so none of this reflects active investment advice or counsel.
Welcome back, everyone, to the UNinvested Podcast. I'm Crockett Callaway.
I'm Sahil Seth. If you've been sticking around for a while, you'll probably remember Episode 1 Part 1, where we discussed Adobe's recent acquisition of famed UI/UX startup Figma for $20 billion. Tons of investors supported Figma along the way and were thrilled at the exit, one of them being Kleiner Perkins. Kleiner Perkins is a legacy Silicon Valley VC fund with tons of notable investments: Robinhood, Plaid, Cameo, Twitter, the list is literally endless. They also just raised an additional $1.8 billion for two new funds, KP20 and Select2, in January, which is their 50th year round.
And today, we're super grateful and super excited to have Shyam Mani. Shyam is an investor at Kleiner Perkins but formerly comes from Bain Capital and Susquehanna. He spent years on both sides of the entrepreneurial process, first as a student founder at Northwestern, and now on the buy side. From cybersecurity to infrastructure tech, Shyam has seen a ton and we're thrilled to learn from him. And since this is an ongoing deal, we should mention that there are some limitations to what Shyam can speak about. Thanks for coming, Shyam.
Yeah, thank you guys for having me.
How's your day going so far?
It's been good. It's a busy Tuesday. Met with a couple of founders, worked on a few things. Business as usual here.
Have you guys been at the office a lot or kind of just virtual hybrid in that aspect?
Yeah, so we're hybrid. I come in about three days a week. We have an office on Sand Hill Road in Menlo Park, and we all go down there once a week for an all-team investment meeting and one-on-ones. We also have an office in San Francisco, which is where I'm at today.
In the new remote hybrid world we're living in, is that the balance you like or are you trying to go in more? What does that look like?
Yeah, I actually like coming into the office. Honestly, it's mostly because I get a free lunch and don't have to worry about that. In-person meetings are different from Zoom meetings, in my opinion. You actually get to connect with the person you're talking to, whether it's a founder or another investor. I value in-person meetings more, especially after two years of Zoom classes and stuff. I try to come in as much as I can. Every partner is different; some never come in, some are always here. It's also nice to get a lot of face time with them if you're in the office more.
Hopefully, when you become a recurring guest, we can have you in person in the studio and not over Zoom.
I would love that. I know personally, I need to be in person. Otherwise, I find myself laying on my bed during Zoom classes, which isn't productive.
Why don't we jump into our first question? We saw that KP morale must be high with the Figma deal. We saw a whole website dedicated to Figma congratulating them. When was the first time you heard about Figma and what stood out to you?
I heard a lot about Figma after I joined Kleiner. I joined Kleiner about six months ago, so I'm relatively new to the investment team. The first time I heard about Figma was at Northwestern. All I knew at the time was that it was an interesting design prototyping tool. One of my designers was using Figma to build our design template and some UI stuff for us. That was the first time I played around with it. I saw the product and it was super cool. My designers could collaborate on what they were working on, we could build a design template from scratch. It was a really easy way for me, as someone managing product, to see what was going on and visualize the product we were building. That's the first time I came across it. When I became an investor, I thought about it from a completely different angle, which was cool.
I'm curious about that angle. So you're at Northwestern, a student founder. Are you looking at Figma back then from more of an entrepreneurial founder perspective, thinking about what makes this work and what doesn't?
Exactly. Figma has a free education tier. With your Northwestern address, we had access to the entire suite of tools Figma offered. As a student founder, it's really helpful because you get an enterprise-grade tool for free. For me, it was cool because I had two designers and one front-end engineer who lived and died with Figma. I could jump in anytime, see what they were working on, and have a good idea of what the product should look like. You can play around with the entire flow of the product. When you're putting it in front of a customer, you can walk them through a wireframe step-by-step and see how it resonates. It's pretty cool and you can start to visualize how an enterprise would use this tool and why it's such a critical component of every design team out there.
For sure. So, I'm curious about that angle switch. KP first started interacting with Figma in 2017, longer than the six months you've been at KP. What were the murmurs about Figma when you arrived at KP?
When I came to KP, Figma was already a big deal for us. It was one of the first deals that Mamoon, one of the partners here, did. All I knew about Figma was that it was one of our big winners. Everyone spoke highly of Dylan, the founder and CEO of Figma. Dylan's history with KP goes back before his Figma days. He was a Kleiner Perkins fellow in 2012, which is a fellowship for college students to get placed within our portfolio companies. Dylan had known the Kleiner Perkins team for a while. Many people at Kleiner had known him for the last 10-15 years. We made the big investment in 2017 and the company has been on a rocket ship ever since. It's a cool success story of an inspiring founder who comes out of the Kleiner Perkins fellowship and one of the big winners in our portfolio.
When you hear about Figma, do you think this company is going to change the UI/UX field, or do you think the collaboration thesis could be applied to other industries? What's the main focus?
I think the collaboration thesis will continue to apply in many industries. Both Ilya and Mamoon were on the board of Slack, which was also built around collaboration. Collaboration and workflow tooling have always been a big part of what we've invested in at Kleiner.
You go to Kleiner and know Figma is one of their big winners. You're still hearing murmurs about them. This amazing deal comes around, and Adobe purchased Figma for about $20 billion. What do you make of the partnership? Why do you think it's a great one? What do the benefits look like?
I think it's no secret that Adobe is buying one of the most exciting and fast-growing competitors to their core business. The markets reacted differently than our internal sentiment. We were very excited because this unlocks a new chapter for Figma. Figma, in its early years, was selling to tech-forward companies and now to enterprises. The Adobe acquisition allows them to access a new distribution channel. Adobe is in every single enterprise in some capacity. The opportunity to join forces with Adobe and market Adobe plus Figma to enterprises will cause another inflection in their journey. I think we'll look back at this acquisition in 10 years and see it as a Facebook buying Instagram type acquisition. The value creation will be far greater than two, three, or four. Figma will unlock new customers and larger deals.
I think this is unlike other acquisitions. Dylan is a special founder who believes in running Figma as a separate entity. He's not someone to get bogged down in the bureaucracy of Adobe. He is hyper-focused on proving every single person who shorted Adobe stock wrong.
I find that similar to Instagram being bought by Facebook. It's a very separate entity. The Adobe deal is even more amazing. In a recessionary environment, putting a 50x multiple on a company with revenue doubling from $200 million to $400 million is crazy. It's going to cause news and panic about justifying it, but you justified it perfectly looking forward for both companies. It's perfect synergies.
Adobe wants access to the demographic that Figma has. Figma has done a wonderful job getting in front of students. Adobe is still working on that. Figma has built an amazing, intuitive product. Adobe has a lot to learn from that. The synergy is mutual. Adobe's annual Max conference introduced new collaboration features for Photoshop and Illustrator. Having Dylan as part of the executive team will take them to the next level. Dylan is very special, not just as a founder, but in many ways.
Adobe saw that and was willing to pay the price for it. It's interesting to see a big legacy firm buy a hot startup. Do you think there's a difference in innovation speed when legacy firms buy hot startups like Figma, compared to having no competition?
There can be. There are counterexamples like Twitter buying Vine and then sunsetting it. But you can also do it right, like Facebook with Instagram. Mark Zuckerberg knows how to run separate entities like WhatsApp. Adobe can do the same if done right. Giving the company autonomy to grow by itself is important.
I'm curious about doing it right. We've talked about Dylan and his vision for keeping Figma running independently. Adobe's CEO Shantanu has come under a lot of praise. There's also talk of David Wanwani potentially succeeding him. What do you think Shantanu needs to do to live up to his role as a legacy leader and not a founder? How does that partnership work?
I think it's about understanding each other's relative positions in the market. Understanding your lane and keeping it. Not trying to compete with Figma or forcing them to sell legacy products. Being clear about boundaries and collaboration points is important.
You know, I do wonder about keeping separate but it's like when you own the company, you see the best facets like the collaboration elements. It must be hard to restrain yourself. Like Adobe might now know how to make Adobe Cloud a fully collaborative platform but wants to keep it separate.
Yeah, and Facebook did a beautiful job with Instagram. They taught Instagram how to monetize, helping them figure out the right parts of the advertising engine. That made Instagram a standalone, whatever, 100 billion dollar entity. That's the common point they need to find. My personal opinion is that Figma has already cracked getting into the enterprise. Adobe has a large distribution base, and they can tell Figma how to get in front of these customers. That's the synergy.
For Adobe, it's about learning from what Figma has done well. It's not just about moving features but having access to the people who built this amazing collaborative product. That's the learning that goes both ways.
We talk a lot about people, both the ones building Figma and the designers they cater to. Figma is hugely popular with designers, and many have expressed their opinions on the deal. What do you think they need to do now to ensure they're still catering to this designer environment?
I think it starts with Dylan's vision. He needs to be, and he is, very clear about not being done. He's not retiring; he's here to prove every naysayer wrong. Figma has done a great job being friendly to designers, offering a free education tier, and being design-first. They need to continue releasing new features at the same cadence. Even after the announcement, there's still a Figma product release on Twitter every two days. Just sticking to what they've done well in the past, being vocal, friendly, and humble, is key.
We've talked a lot about Adobe and Figma, which hold about 70% of the market. Where do you see the UI/UX space going in the future?
Taking it back to 2017, the fundamental thesis Kleiner had was that design is going to be an important part of the product development lifecycle. Designers are becoming an important part of this lifecycle and need purpose-built, collaborative tools. That was the thesis behind Figma. It's grown a lot from there. Now, product managers and front-end engineers also use Figma. Anyone within a product development organization has used or touched Figma. The future is just following that trend, moving from designers to front-end engineers. My hope is that Figma will reach a point where you can create a wireframe, connect it to a database, and build a fully functioning app. That's the future I hope they're driving towards.
You see a lot of productivity and collaboration features they're continually working on. The future for Figma is making these wireframes and prototypes more interactive and functional. In three to five years, Figma could be used to build fully functioning apps. This is my hypothesis, not insider information.
Moving towards the low-code, no-code space in a way. But Figma will always be a design tool first. Making design as complete as possible and not just dragging and dropping elements.
Figma is such an end-of-one company. It's hard to distinguish between how the role of design within companies influenced Figma and how Figma influenced the role of designers. When you can't distinguish between them, you have a generational company. The future of design is Figma.
We have one last question for you, Shyam, and I think it's perhaps our most important question. We love to ask our interviewees and guests: What is one routine or staple you follow throughout the years? It could be simple or complex.
It's changed over the years. In high school, I read the news every day because I was a debater. From ninth grade to freshman year of college, I did that religiously every morning. Since college, I haven't had a routine. Every day was different. Now, I try to meditate for 30 minutes in the morning. That's my post-college routine.
Love it. That might be the most meta response we could have hoped for, which is that your stable routine is you like to switch up your routine. Love it.
Thank you so much, Shyam. It's been great to have you.
Of course. Thank you guys again for having me. I don't know much about this world, but I appreciate you giving me a place to speak about it.
Thank you, Shyam. As always, I'm Crockett Callaway.
I'm Sahil Seth. This is Shyam Mani and this is UNinvested.
Thank you.
