Add Figma (FIG -0.17%) to the list of tech stocks with sizzling initial public offerings (IPOs). The developer of artificial intelligence (AI)-powered software announced an IPO price of $33 per share on July 30, 2025. Its stock opened the next morning at $85 and soared as high as $142.92 the following day.
Granted, Figma subsequently gave up some of its tremendous gains. However, its stock remains more than 170% higher than the IPO price.
Figma appears to fit the profile of previous tech stocks that have become huge winners for long-term investors. Could buying $10,000 worth of this hot AI stock make you a millionaire?
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What Figma does
Brown University students Dylan Field and Evan Wallace founded Sigma in 2012 to make the design of digital applications more collaborative. It took a while for their idea to catch on: Some designers were reluctant to give up their creative control and were afraid they'd be micromanaged. That initial hesitance faded over time, though, as design teams experienced the benefits of collaboration.
Figma didn't limit its focus to design. In 2021, the company launched an online whiteboard for collaborative brainstorming called FigJam. Two years later, it introduced Dev Mode, a platform that helps translate design ideas into real software products. Figma rolled out Figma Slides in 2024 to facilitate the creation of collaborative presentations.
2025 has been an especially busy year for the company. In addition to conducting its IPO, Figma launched four new products. Figma Sites enables users to design and publish a website. Figma Make harnesses the power of generative AI to create fully functional prototypes from text prompts. Figma Buzz allows users to create social media posts, ads, and other marketing materials. Figma Draw helps create digital illustrations with vector brushes and other editing effects.
Today, 76% of Figma's customers use at least two of its products. The company's customer base also includes 95% of the Fortune 500 and 78% of the Fortune 2000. Figma's customers are a virtual who's who of online companies, from Airbnb and Atlassian to Netflix and Zoom.
A massive opportunity
Figma estimates that its current total addressable market is around $33 billion. It generated revenue of $749 million last year -- less than 2.3% of that total. But this market should grow rapidly.
International Data Corporation (IDC) projects that over 1 billion new apps will be added worldwide by 2028. This explosive growth presents a massive opportunity for Figma.
The company has a clear plan to capitalize on this opportunity. Figma is working to convert both new and existing users into paid customers. It's encouraging current customers to use more of its products and extend usage to more of their staff. Figma is also expanding internationally.
Perhaps the most important component of its growth strategy, though, is adding new products. Figma continues to invest heavily in research and development. The company is also making strategic acquisitions that boost its capabilities. For example, Figma recently bought a tech company that has a self-hosted content management system.
Could Figma turn $10,000 into $1 million?
To turn an initial $10,000 into $1 million, Figma would need to deliver a 100x return. Is that possible? Sure. Is it probable? I don't think so.
For one thing, expectations of significant growth are already baked into Figma's share price. The stock currently trades at a price-to-sales (P/S) ratio of 49.3, according to LSEG. Even with Figma's impressive 46% year-over-year revenue growth, that's a steep valuation.
There's also another mathematical hurdle. Let's assume that Figma captures every penny of its estimated total addressable market of $33 billion. Heck, let's even say that the market size doubles to $66 billion. But we'll also need Figma's price-to-sales (P/S) multiple to be more realistic. The current average P/S ratio for application software companies is around 8.8.
Multiplying $66 billion in sales times a P/S ratio of 8.8 gives us $580.8 billion. That's a far cry from the market cap of a little over $4 trillion that Figma would need to have to grow $10,000 into $1 million.
Figma is, without question, a hot IPO stock. If you're looking to become a millionaire, though, you'll probably need to find other stocks to buy.
