Figma’s Pursuit of Long-Term Backers Kept IPO Price in Check (1)

Figma Inc.’s record-breaking debut gains are cooling, but they have still handed a windfall to investors including the select institutions that were able to get their hands on the IPO shares, sparking debate over whether the stock was priced too low. Behind the scenes, the desire to court long-term investors influenced the outcome.

The stock’s 250% jump in its debut session — the biggest ever first-day pop from a $1 billion-plus US IPO — meant the company and the selling shareholders effectively handed over more than $3.5 billion of value to investors that were able to get shares.

Shares ...