10:26 AM EDT, 08/13/2025 (MT Newswires) -- Figma's ( FIG ) public debut made waves late last month, as its stock surged 270% in its first two days of trading, the latest sign that investors are excited about a return of tech IPOs after a multi-year drought, experts said.

The collaborative design platform's impressive premiere follows a handful of other highly anticipated tech IPOs this year, including from CoreWeave ( CRWV ) and Circle Internet Group ( CRCL ) . The Nasdaq said on July 1 that it welcomed 142 IPOs in the first half of the year raising $19.2 billion, its highest first-half volume of listings and capital raise since 2021.

The dearth of tech IPO enthusiasm the prior few years was tied to downbeat market sentiment in the post-Covid era, according to Running Point Capital Advisors Chief Investment Officer Michael Ashley Schulman.

"The IPO drought began as a (Federal Reserve) hangover when rates ripped higher, growth multiples deflated, volatility spiked and equity markets responded with a hard decline in 2022," Schulman told MT Newswires via email. "The 10-month drop was followed by a V-shaped recovery that many market pundits and observers didn't have confidence in. And even when equity indices confidently achieved new highs in 2024, economic growth concerns remained and election volatility entered the psychological fray."

The recent run of tech IPOs isn't enough to declare the drought over, but it is a sign that its days could be numbered, equity research analysts at Truist Securities said in an Aug. 4 note.

"A potential thawing of the software IPO activity could be in the offing and increased investor appetite for these assets could be returning while the regulatory environment could see some potential easing," they said.

Figma ( FIG ), which priced its IPO at $33 per share, has seen its stock come down from its euphoric highs, but is still trading above $85 per share, a sign that market enthusiasm has as much to do with the company's strong fundamentals as it does with animal spirits.

In its filings to go public, Figma ( FIG ) said 95% of the Fortune 500 and 78% of the Forbes Global 2000 use its software. It reported 48% revenue growth in 2024 to $749 million and first-quarter gross margins of 91% supported by 132% net dollar retention.

"The buzz around Figma's ( FIG ) business remains strong, but the intoxicating rush that drove its dizzying valuation during its first two days has cooled, as eager investors who craved early exposure jumped in during initial trading sessions, while fortunate IPO share recipients are likely harvesting some gains," Schulman said. "Versus pre-IPO chatter, the current market capitalization still embeds a premium for category control and high growth, even after the comedown from the opening-day euphoria."

Adobe (ADBE) and Figma ( FIG ) dropped their proposed $20 billion merger deal in 2023 amid intense antitrust scrutiny from regulators, setting the stage for Figma's ( FIG ) IPO pursuit and inspiring feelings of "validation by negation" among market participants, Schulman said.

Looking forward, macroeconomic factors like rate expectations, trade tensions and midterm election volatility will help determine whether Figma's ( FIG ) recent run will inspire other private tech companies to seek public liquidity.

"Hopefully, this wave is more sustainable than a New Year's gym resolution where some keep up the pace but others quietly cancel," Schulman said.

Price: 86.65, Change: -0.71, Percent Change: -0.81