Penpot, the open-source platform for designers and their coders, draws up $12M as users jump to 250K
Open source projects continue to stand out as compelling alternatives to proprietary software for those who are looking for more flexibility or price leverage in the tools that they use to work. Today one of the juggernauts in the space of design is announcing some funding. Penpot, an open-source platform for designers and the developers to collaborate on work in a single environment, has raised $12 million, equity funding that it will be using to drive more adoption after hitting 250,000 users this month and 20,000 “stars” on GitHub.
For some context on those numbers, Penpot’s user numbers blew up last year in the wake of Adobe acquiring Figma for $20 billion, growing 5,600% to 100,000 users in the space of a couple of weeks. That momentum is still strong if not quite as outsized: Penpot’s 250,000 users today represents a user growth rate of 500%.
“The battleground in design for the next few years is clear and that is who will win over the developers,” said Pablo Ruiz-Múzquiz, Penpot’s CEO and co-founder, in an interview this week.
The logic behind Penpot has been to create tools that designers will use and love, but that will be equally embraced by their developer counterparts, too — an audience that design tools up to now have failed to capture, let alone build for or target, yet is essential to include in the collaboration process earlier than it typically is. “Developers outnumber designers 10 to 1. So while Figma has 1 million accounts those are just designers, which means they have cut out an important audience. Sure, we want more designers in the world, but we keep getting more developers.” Building something both can use at the same time, he said, “is the big opportunity for Penpot.”
The funding will be used in part to build out more tools that can be used both in the cloud and in self-hosted and local environments; and indeed, the news is coinciding with Penpot launching a number of these out of beta that speak to how it’s building with design and coding sensibilities in tandem.
They include a new suite of “Flex Layout” tools for building responsive layouts in CSS; a tool that lets users tap browser memory to boost memory caches for collaborative projects up to 16GB (2GB has been an industry standard limit up to now); better code inspection features; more agility for adding in occasional contributors to a project; and more.
All of these, as with all of Penpot, are totally free to use as the company has yet to put in place any kind of paid features or services. The longer-term questions, therefore, are not just if Penpot can continue to pick up a critical mass of users of its open source tools, but if it can find effective ways of monetizing the platform to keep them there.
This latest round is being led by Decibel, the VC firm affiliated with Cisco, which also the startup’s $8 million Series A that it announced in September 2022; other existing backers — which include a number of high-profile angels and Athos — also participated.
Ruiz-Múzquiz said this round falls somewhere in the region of “Series A+”: it’s not part of the previous Series A, but it is a clear precursor to a Series B. Kaleidos — the startup parent of Penpot and the actual name of the company — has doubled its valuation with this round, Ruiz-Múzquiz confirmed, although he is not disclosing the actual figures. One other detail: he said Kaleidos could have raised up to $20 million this time around — a mark of how some of the buzziest startups, and those finding a lot of traction, have not faced the same fundraising difficulties as some others in the field.
Penpot’s emergence comes at the confluence of a couple of other developments.
Adobe’s acquisition of the popular design tool Figma sent shockwaves through the design community, with many predicting that the deal would spell the end of the product as they know and love it, given Adobe’s bigger agenda around selling its proprietary design and marketing tools. At the same time, we’ve seen a growing momentum of interest in open source alternatives to existing products: in the wake of another big piece of M&A in the last six months — Elon Musk buying Twitter for $44 billion — a lot of users of that platform, also fretting about its future, are trying out alternatives, with the open-source, federated approach of Mastodon currently winning the most attention.
Putting those two together and you have a kind of perfect storm for Penpot: for designers and their partners exploring what else is out there beyond Figma, waking up to the potential of open source, here is a product for them to try.
And they have done that: there are now more than 20,000 teams using the product, including groups at Mozilla, Accenture, ByteDance, IBM, Google, and Microsoft. Runa Capital’s ROSS Index notes it’s one of the fastest-growing open source projects at the moment.
Penpot’s pitch is that it’s built a product that is supremely flexible compared to what else is on the market, and specifically compared to Figma. You can use it as a cloud-based SaaS, or hosted in your own environment. The platform allows coders and designers to simultaneously work on the same jobs in real time: a big shift from how these two groups of users work today, where typically wireframes might be put together by designers, and only then handed off to coders to build to those specs. That of course ends up entailing a lot of time and money as a project develops, going through the back and forth of managing that process and any changes that happen along the way.
What’s notable about this fundraise, and the startup itself, is that it’s building in a very pre-Covid-19 way as far as business models are concerned. That is to say, it’s not focusing at all on revenue, or even playing with where and how it might charge for services or features, and instead is keeping the barrier to entry very low by making all of Penpot’s tools today free to use.
Ruiz-Múzquiz said this is something that its investors have strongly encouraged for the moment. “Jon [Sakoda, one of the founders at Decibel] said to us, ‘Don’t be distracted with paid enterprise features. That will come. It’s more important to create the tool and plug-in architecture, which will lead to more value. From that, you lean what might be cool for enterprises,’” he said.
One of the things that the surge of interest in open source has meant is that a number of investors are sniffing around the field to add their own “open source” startup to their portfolios. What’s interesting is that Decibel sees in Penpot a place for activity at a time when some of the other legwork of building digital experiences is being picked up by other technologies.
“Penpot is the first platform that enables designers and developers to collaborate closely and deliver a great user experience. Its momentum is a testament to the pent-up demand for tools that seamlessly support each person’s native workflow and allow cross-functional teams to iterate rapidly,” said Sudip Chakrabarti, a partner at Decibel, in a statemnt. “Technologies such as Generative AI are unleashing tremendous creativity among designers and developers alike and we are proud to continue supporting Penpot so the team can fully capitalize on this moment.”