Form 4: Greylock Funds Convert, Sell Figma Shares Post-IPO

Greylock XIV entities converted preferred stock to Class A Common Stock and subsequently sold a portion of their holdings in Figma, Inc. on August 1, 2025.

Summary

• Greylock XIV GP LLC, Greylock XIV Limited Partnership, Greylock XIV-A Limited Partnership, and Greylock XIV Principals LLC, all 10% owners and directors of Figma, Inc., reported changes in beneficial ownership.
• Various series of preferred stock (Seed, A, B, C, D, E) automatically converted into Class A Common Stock on a 1-for-1 basis immediately prior to Figma's initial public offering.
• On August 1, 2025, Greylock XIV-A Limited Partnership acquired 3,035,825 shares of Class A Common Stock through conversion, bringing its beneficial ownership to 3,074,767 shares.
• On August 1, 2025, Greylock XIV Limited Partnership acquired 54,644,628 shares of Class A Common Stock through conversion, bringing its beneficial ownership to 55,345,586 shares.
• On August 1, 2025, Greylock XIV Principals LLC acquired 3,035,825 shares of Class A Common Stock through conversion, bringing its beneficial ownership to 3,074,767 shares.
• On August 1, 2025, Greylock XIV-A Limited Partnership disposed of 153,738 shares of Class A Common Stock at a price of $31.515 per share, reducing its beneficial ownership to 2,921,029 shares.
• On August 1, 2025, Greylock XIV Limited Partnership disposed of 2,767,279 shares of Class A Common Stock at a price of $31.515 per share, reducing its beneficial ownership to 52,578,307 shares.
• On August 1, 2025, Greylock XIV Principals LLC disposed of 153,738 shares of Class A Common Stock at a price of $31.515 per share, reducing its beneficial ownership to 2,921,029 shares.
• Greylock XIV GP LLC is the sole general partner of Greylock XIV and Greylock XIV-A, and manager of Greylock XIV Principals, and may be deemed to share voting and dispositive power over the shares held by these entities.

Sentiment

Score: 4

Explanation: The sentiment is slightly negative due to significant insider sales, although the conversions are a standard post-IPO event. The sales, even if planned, can be interpreted as a reduction in conviction by a major investor.

Positives

• The conversion of preferred stock into Class A Common Stock is a standard event often associated with a company's initial public offering, indicating a maturation of the company's capital structure.

Negatives

• The sale of a significant number of Class A Common Stock shares by a 10% owner and director group (Greylock entities) could be perceived by the market as a reduction in conviction or a move to realize gains.

Risks

• Significant insider sales, even if pre-planned, can sometimes signal to the market that major investors are reducing their exposure, which could lead to negative sentiment or downward pressure on the stock price.

Future Outlook

The filing does not contain any forward-looking statements or guidance regarding Figma, Inc.'s future performance or strategic direction.

Industry Context

This Form 4 filing reflects a common occurrence for venture capital firms and early investors post-IPO, where preferred shares convert to common stock and a portion of holdings may be sold to realize gains or manage portfolio allocations. It does not provide broader industry trend analysis.

Related Party Transactions

• Greylock XIV GP LLC is the sole general partner of Greylock XIV Limited Partnership and Greylock XIV-A Limited Partnership, and manager of Greylock XIV Principals LLC, indicating a related party structure among the reporting entities.

Stakeholder Impact

• Shareholders may interpret the sale of shares by a significant investor group as a signal, potentially influencing their investment decisions or the company's stock price.
• The conversion of preferred stock to common stock simplifies the capital structure, which can be beneficial for common shareholders by reducing complexity.

Key Dates

Recommendation

This Form 4 filing details a significant insider sale by a 10% owner and director group. While such sales can sometimes signal a lack of conviction, they are also common for venture capital firms post-IPO to realize gains or manage fund distributions. Without additional context on Figma's financial performance, market conditions, or the investor's specific portfolio strategy, this filing alone is a data point rather than a strong signal for immediate buy or sell action. A 'hold' recommendation is appropriate as investors should monitor further developments and broader market trends before making a definitive move.

Keywords

Figma, FIG, Greylock, insider trading, beneficial ownership, stock conversion, stock sale, preferred stock, Class A Common Stock, SEC Form 4