The post-Figma question: Who’s next?

Figma's recent IPO generated significant market attention with a 333% surge in its initial trading days, though it subsequently corrected by 27% on Monday. This successful debut is now widely seen as a potential catalyst to end the tech industry's prolonged IPO drought, with investors like Kirsten Green suggesting it could motivate other late-stage startups to enter the public markets. Consequently, attention is shifting to a watchlist of prominent VC-backed companies, including Databricks, Klarna, Stripe, SpaceX, and various AI startups, with names like Canva, Revolut, Midjourney, Motive, and Anduril identified as more immediate IPO candidates.

Analysis

Figma's recent initial public offering, marked by a dramatic 333% surge followed by a 27% correction, is being interpreted as a significant potential catalyst for reopening the dormant tech IPO market. This event has shifted investor focus towards a pipeline of late-stage, venture-backed companies that have been awaiting favorable market conditions. The successful debut of Figma, along with Chime's 37% first-day pop, appears to be fostering a renewed eagerness for public listings, a sentiment reinforced by Kirsten Green of Forerunner Ventures and evidenced by the immediate S-1 filing from medical technology firm HeartFlow at a $1.3 billion valuation. While long-speculated names like Databricks and Stripe remain on the horizon, conversations with investors suggest that companies such as Canva, Revolut, Midjourney, Motive, and Anduril are now viewed as more likely near-term IPO candidates, signaling a potential wave of new offerings across the technology, AI, and fintech sectors.

Key Decisions for Investors

• Investors should actively monitor the identified watchlist of late-stage private companies, particularly Canva, Revolut, and Anduril, as they represent the most probable near-term IPOs in a potentially reopening market.
• Exercise significant caution regarding the high volatility of new listings, as exemplified by Figma's 333% initial surge and subsequent 27% drop, suggesting that waiting for price discovery and stabilization post-IPO may be a more prudent strategy than chasing first-day performance.
• Consider evaluating publicly traded entities with significant exposure to late-stage private technology companies, as a revived IPO market provides a crucial exit path that could unlock substantial value for these investors.