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I've browsed through 100s of reddit posts, articles, youtube videos talking about how Claude Design and Google Stitch are going to replace Figma. The stock has plummeted to a new All Time Low after both announcements and I think this creates an opportunity for us regards.
# Claude Design is fundamentally flawed for the job.
Claude Design is actually nothing but a Claude Code wrapper with "Inspect Element" turned on. Claude Design under the hood generates React code, similar to what Claude Code would generate. This is because of the inherent limitations of LLMs - Large Language Models. Emphasis on the word "Language" here. These models generate text and that's it! AI agents, Claude Code, Cursor, etc seem magical because of the harness and capabilities given via shell/bash commands, CLIs, MCPs, etc. All of which take in text data and output text data. By creating harnesses that can execute these commands (which obviously are texts, they are able to achieve results which look and are "magical"). However, designing stuff is fundamentally different. Figma, Adobe XD all have rendering engines that do complex rendering computation to build components which are not some code, but actual elements represented in a renderer. This is something LLMs fundamentally cannot do. They can create an illusion of generating designs via code, but to create something that can natively edit elements - something a professional designer needs to do, needs a rendering engine.
# Claude Design and Google Stitch are Canva replacements at best.
Yes, people will use Claude Design and Google Stitch, but the users are fundamentally different. Someone who's not a designer who needs a quick design goes to Canva today. Instead tomorrow they will go to Claude Design. A professional designer with skills will still go to Figma or Adobe XD. Yes, they might use some AI features in these platforms to speed up their workflow, but they NEED a tool that has some sort of rendering engine to do their job right.
Some devs also used to go to websites that offer free website templates, download them for 30 bucks, tweak it, reuse it. They might now use Claude Design to generate something first before feeding it to Claude Code. Sure these users will go to Claude Code and Google Stitch, but they were never Figma users in the first place.
# Claude Code disrupted Coding, hence Claude Design will disrupt Design
This is what the market is pricing in. These two are fundamentally different problems altogether. SDE lifecycle roughly goes like this:
requirement gathering -> coding -> testing -> review -> deployment -> iteration -> support.
Claude Code takes a stab at the solo part of the SDE work i.e. coding. Devs have their favourite IDEs, terminals, customizations, plugins, fonts, themes, and now AI assistants (Codex, Claude Code, Cursor, Copilot etc). This part is easy to be replaced since its very individualistic in nature. Replacing any other part of this workflow is hard. Example for review (the collaboration aspect of the job) switching from github to gitlab is an organizational change. Hence Claude created Claude Review which sits inside Github instead of trying to create their own Git hosting service that has a code reviewer.
Design, however, is very different. Some credit here goes to Figma itself. Figma has a lot of things integrated in it. Designing, Collaboration, Templates, Versioning, Libraries, etc. Handoffs from Product -> Design -> Devs and iterations all happen inside Figma. The assumption that since Claude Code was able to penetrate in enterprise setting so Claude Design would is very wrong.
# AI companies are trying to keep the AI hype on.
Don't get me wrong, AI is very useful. I use Claude Code every day for my work. Never before in my career I've seen something as useful as these AI tools to help with writing code. I do agree these thing are here to stay, I just think they are a little overhyped. Everyone knows there's a bubble when a footwear company adds AI to their name and the stock jumps 800% in a day. These AI companies need to keep the AI hype train on to justify their insanse valuations. The token subsidization is unreal and once the reality hits on how expensive this all is, AI tools even in software engineering are going to take some hit. Something these LLMs are absolutely meant for -- textual data like coding. The tools that are not meant for these LLMs like pseudo-design tools like Claude Desing will take a larger hit and maybe them as a Canva replacement might be off the table too. Who knows.
Soon OpenAI will release their own tool for design like Google and Anthropic to stay relevant. A few YC startups have tried doing this before too, but Figma is here to stay.
Apart from all this, of course I can talk about strong fundamentals, CEO compensation incentive, Figma Make, etc but you can look all of those up separately. Instead, I am here to show the bigger picture the market is missing.
Positions - 50k, deep in figma balls.