Issue No. 1
We’ve spent our entire careers at the intersection of creativity, media, and entrepreneurship, and we believe that the business side of design deserves full-time coverage. Starting now.
Today, we’re launching The Creative Factor for people who use design practices to invent, build, grow, and reinvent their products, companies, and industries. Look for a digest of news, insights, and analysis delivered to your inbox on Wednesdays.
We will cover the business of design through a wealth of perspectives, from the executive level to individual designers and entrepreneurs. And we’ll explore a range of topics, from mainstream news that affects the design community to how creative teams operate. It looks a little something like this:
The design industry is in the midst of a pivotal shift. Corporations tended to view design as a colorful flourish to a core product. However, that attitude is evolving. Today, design offers a competitive advantage in business, one that improves the human experience.
Effective design makes products and services accessible by reducing friction and translating technology into human-centered experiences. It is transforming not just the products we use, but how we live.
We see this in how we can manage world travel from our phones. Or how our wristwatches operate as medical-grade ECG systems, providing us with real-time health information. Today, we can control our finances and send money through the click of a few buttons, rather than go to the bank, meet in person, or even use traditional currency from a traditional bank account. Or we can set up a first date, buy a home, or watch our favorite musician perform in concert while laying on the couch in our pajamas.
In this inaugural newsletter, we begin in the C-Suite to better understand how global executives view creativity within their organizations. And guess what? They acknowledge that design practices are not only ideal for solving an array of diverse challenges, but can also boost the bottom line.
We’ve noticed that investors poured more than $225 million into design tool makers in the past year. What do they see in this space? Maybe it’s that these tools are no longer simply for design and prototyping. These cloud-based ecosystems are becoming de facto communication hubs for product development across leading companies.
Finally, corporations are hiring experience designer likes crazy. Last we checked, Amazon alone is looking to fill some 400 roles. So we share a salary tracker that helps translate byzantine corporate leveling into real-world competitive compensation.
Thanks for reading our inaugural newsletter. See you on Wednesday, August 21 when we’ll be back to start our weekly schedule.
Matt McCue & Amanda Tuft, Co-Founders / Editors@thecreativefactor.co
Nothing gets our heart racing like a good research report. For its “Striking Balance with Whole-Brain Leadership” report, Accenture Strategy interviewed 200 global executives to test the hypothesis that there are bottom-line benefits for leaders who build well-rounded C-Suites with business /and/ creative leaders. Typically, executive teams have been filled with traditional business types, such as CFO, COO, and general counsel, with the CMO being the lone “creative” exec. But the findings show a shift in mindset.
The overwhelming majority (89%) of the executives said they are left-brain, business-y, scientific thinkers. In a linear world, that’s a fine approach. Business today looks more like a Jackson Pollack painting: Companies know they must excel at many overlapping factors, including growth, profit, user trust, sustainability, and more. Therefore, C-Suites need to be adroit at the “art” of people and the “science” of business.
To develop a well-rounded leadership team, 82% of the executives said they are planning to bring more right-brain, creative, intuitive thinking to the C-Suite in the next three years.
A progressive, whole-brain leadership approach is good for tackling a diverse set of challenges, and it boosts the bottom line. Accenture Strategy’s research showed a whole-brain approach correlates with stronger financials: 22% higher revenue growth and 34% higher profitability (EBITDA) growth over a three-year period.
Fostering innovation and creative problem-solving isn’t new to the design industry, but the recognition and elevation of it across industries is. We’re seeing the rise of creative leadership at both startups and established companies.
The News
More than $225 million has been funneled into design tool companies since November 2018.
Wait, wait, wait! Is this going to be a story about valuations and the alphabet soup series A, B, C, D, E, F, TTFN, PDQ, XOXO raises? After reading about a $12+ billion food delivery startup last week, we call uncle.
Fair point. But hear us out: This isn’t about any one raise or valuation, but about what investments across the private companies InVision, Figma, Abstract, Framer, Sketch, Webflow, and Balsamiq indicate for the design community.
O.K. Who invested?
Investors ranged from Goldman Sachs to Peter Thiel’s Founders Fund to LinkedIn CEO Jeff Weiner, as well as early backers of Facebook, Instagram, and Spotify. These new faces in the creative space show the wide appeal of investing in experiential products.
And who is getting the money?
InVision ($350.2 million) has received more funding than the rest of the companies combined ($193 million). Meanwhile, both Balsamiq and Webflow have built profitable businesses using little to no outside funding. The competition is heating up.
Which companies are using them?
Apple, Facebook, Google, Microsoft, Spotify, Salesforce, Slack, and Cisco to name a few.
Not a bad customer list. What does this all mean for designers?
That, in a relatively short amount of time, these tools have evolved from relatively niche products to design-driven, enterprise-grade platforms for employees to collaborate across teams.
They’re a place where you can collect data, provide feedback, share ideas, test product features, and generally keep everyone, from design to engineering to product management to VPs, on the same page. The environment provides more context around decisions than a stand-alone presentation. It’s further evidence that the role of design at the heart of a company is growing.
Would you call design’s ability to give companies a competitive edge “the creative factor”?
You took the words right out of our mouth.
**Read on for the full funding figures sourced from Crunchbase unless otherwise noted. Adobe, a public company, does not currently share numbers around Adobe XD.
Balsamiq
Total funding: $0
Founded: 2008
Sales details: Each year, Balsamiq publicly shares its sales figures. In 2018, the company posted revenue of $6.015 million, down 5.7% from 2017 due to desktop revenue declining faster than expected. Per Balsamiq, $6 million in annual review is still “way more than we need to operate profitably.”
Of note: Between 2016 and May 2019 Balsamiq grew from 22 to 31 remote employees, and the team splits 20% of company profits.
Webflow
Total funding: $2.9 million
Founded: 2013
User numbers: 30,000 paying customers
Of note: Webflow’s most recent funding was a $1.5 million seed round in March 2014 and included participation by Khosla Ventures and Y Combinator. Webflow reports $1.2 million in monthly recurring revenue. (The Information reported just yesterday that Webflow is in talks to raise $20 million in new funding. Webflow has not publicly confirmed this.)
Sketch
Total funding: $20 million}
Founded: 2011
User numbers: Sketch crossed 1 million paying customers in 2018; major clients include Apple, Facebook, and Google
Of note: The entire $20 million investment was made in March 2019 by Benchmark (investors in Twitter, Uber).
Framer
Funding: $33M; with the most recent round, a $24 million series B raise, in November 2018
Founded: 2014
User numbers: 125,000 users; more than 100 teams, including Twitter and Dropbox.
Of note: Co-founders Koen Bok and Jorn van Dijk sold their first company, Sofa, to Facebook in 2011. After working at Facebook until 2013, they left to start Framer.
Abstract
Funding: $54.2 million, including a $30 million series C in March
Founded: 2015
User numbers: More than 5,000 teams use Abstract, including Spotify, Salesforce, and Cisco.
Of note: While Abstract has not publicly disclosed its valuation, Techcrunch pegs the figure at $190 million, up from the Series B valuation of $76 million in May 2018.
Figma
Funding: $82.9 million, including a $40 million series C in February 2019 led by Sequoia Capital (Instagram, WhatsApp)
Founded: 2012
User figures: More than one million sign ups; teams using it include Uber, Slack, and Microsoft
Of note: Figma’s valuation is currently $440 million, and it is backed by Kleiner Perkins (Spotify, Dollar Shave Club), Greylock Partners (Facebook, Instagram), LinkedIn CEO Jeff Weiner, and Peter Thiel’s Founders Fund (Facebook, Twilio), who all participated in the Series C.
Invision
Funding: $350.2 million, including a $115 million series F in December 2018 led by Spark Capital, with Goldman Sachs participating. This follows a $100 million series E round in November 2017.
Founded: 2011
User numbers: 5 million users
Of note: InVision is currently valued at $2 billion.
Thankfully, there’s Levels.fyi, a crowdsourced comp tracker for your next negotiation.
The Landscape: Some of the biggest companies in the world are building design teams in the hundreds, if not thousands, of employees. And they’re still adding new roles every day. But with these companies not publicly disclosing salaries, applicants are left guessing as to what they’ll earn in roles that don’t have well-established precedents—IC5 Product Designer at a 35,000-person company, anyone?
Thus, Levels.fyi was born: Zuhayeer Musa and Zaheer Mohiuddin launched Levels.fyi for corporate employees, including designers, to input their company, location, career level, and total comp (cash, stock, and bonus) and compare these across other organizations.
How it works: Levels.fyi contextualizes what titles mean across companies. For example, an experience designer with 10 to 15 years of work experience would correlate to L6 Staff Designer at Google, IC7 Principal Designer or Senior Design Manager at Amazon, and an IC6 at Facebook.
Going deeper: Levels.fyi zeroes in on total comp based on key details. For instance,14 salaries of Google L4 designers with 5-10 years of work experience are listed. Using this tool, you can see that someone with five years of experience in the Mountain View office makes a salary of $142,000 with an annual stock grant of $21,000 and a yearly bonus of $35,000, for total comp of $198,000. This inside info can help level the playing field for your next comp negotiation.
Images in this issue sourced from Getty Images Creative.