InVision
The prototyping tool of design teams: fell behind Figma, from USD 1.9 billion to closure
- Founded
- 2011
- Closed
- 2024
- Lifespan
- 13 years
- Total funding
- $350 million
- Peak valuation
- $1.9 billion
- Became a unicorn
- 2017
- Country
- United States
- City
- New York
- Sector
- Enterprise software (SaaS)
- Founders
- Clark Valberg
- Investors
- Spark Capital, Goldman Sachs, Battery Ventures, ICONIQ Capital, Tiger Global Management
- At its peak
- USD 1.9 billion valuation and USD 100 million annual recurring revenue in December 2018
- Cause of closure
- Lost to competitors
What did it do?
InVision was a design and collaboration platform that let designers turn flat screens into clickable prototypes. Clark Valberg started it in 2011. A USD 100 million round took it to a USD 1 billion valuation in 2017, the same year it launched the digital whiteboard Freehand. In December 2018 it reported more than 5 million users and USD 100 million in annual recurring revenue.
Why did it shut down?
After its USD 115 million Series F at USD 1.9 billion in December 2018, InVision fell behind on renewing its core product. According to LogRocket, the product stayed built around hotspots while Figma made layers interactive, and by 2020 Figma held most prototyping users. Revenue halved to USD 50 million in 2022. Rising borrowing costs and cautious investors narrowed the options, and Valberg's attempt to sell the company failed. Freehand was sold to Miro in autumn 2023. Chief executive Michael Shenkman announced on 5 January 2024 that services would end that year, and accounts closed on 31 December 2024.
The story
InVision began in 2011. Clark Valberg's company solved a simple problem: designers could turn flat images into clickable prototypes and show them to their teams. The tool soon became a habit for UX teams.
A USD 100 million round in 2017 took the valuation to USD 1 billion. In December 2018 a USD 115 million Series F valued it at USD 1.9 billion. At that point the company reported more than 5 million users and USD 100 million in annual recurring revenue.
But the market was moving. Figma ran in the browser and brought several people into the same file. By 2020 most prototype users were there. InVision's revenue fell 50% to USD 50 million in 2022.
Freehand was sold to Miro in autumn 2023. On 5 January 2024 chief executive Michael Shenkman said services would end that year. Accounts closed on 31 December 2024, ending a thirteen-year story.
Lessons for founders
- Being a category's pioneer does not protect you: when a rival does the same job by rebuilding the workflow underneath, your familiar product stops being an advantage.
- Do not spend on new modules while the core product quietly ages: by 2020 most prototype users had moved to Figma. Fix the friction users meet every day first.
- Talk about a sale while you are strong: trying to sell once revenue halved in 2022 will not bring an offer near a USD 1.9 billion valuation.
Sources
- InVision, valued at $1.9 billion, picks up $115 million Series F (TechCrunch, 2018-12-11)
- UX design company InVision is shutting down this year (Silicon Republic, 2024-01-05)
- $2 Bn Design Startup InVision Shuts Down Amidst Industry Rivalry (Analytics India Magazine, 2024-05-01)
- InVision is shutting down (LogRocket, 2024-03-12)
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