‘Truly special’: Canva’s valuation rockets to $19 billion

Australian graphic design startup Canva has hit an on paper valuation of $US15 billion ($19.7 billion) after securing a new round of funding making it one of the fastest-growing private technology companies in history.

The milestone comes after Canva turned over $US500 million last financial year, a 130 per cent increase, and is on track to record $1 billion in revenue this financial year buoyed by the shift to remote working driven by the coronavirus pandemic.

Its pace of growth can be compared to local tech giant Atlassian which was founded in 2002 and did not crack the $US500 million revenue threshold until 2017, while video conferencing juggernaut Zoom was founded in 2011 and only surpassed $US500 million for the first time in 2019.

Melanie Perkins is the co-founder and chief executive of Canva which is now valued at $19 billion. Credit: James Brickwood

Canva was founded by Melanie Perkins, Cliff Obrecht and Cameron Adams in 2013 and aims to allow anyone to easily design products including greeting cards, posters, websites and presentation slides.

Its latest valuation also turbocharges the wealth of the co-founders. Ms Perkins and Mr Obrecht were married earlier this year and their stake in Canva is now worth an estimated $7.98 billion, while Mr Adam’s share is valued at an estimated $2.24 billion.

The investment round of $US71 million came from existing investors Australian venture capital firm Blackbird Ventures and Scott Farquhar and Kim Jackson’s Skip Capital, alongside US investment firms Dragoneer and T. Rowe Price. The total raised by Canva was almost $US390 million.

“We’re profitable and we’re very fortunate that we can still find investors that align to our vision and values. I often say that we’re just one per cent of the way there with Canva.

Cliff Obrecht

Mr Adams said Canva was keen to tap into the US firms’ expertise on scaling fast-growing companies. “We’re always going through crazy growth at Canva but now that we’re over 1500 people in our offices around the world and we’ve got 55 million active users using the product it’s a whole new level of scale that we have to deal with,” he said.

“Locally I’d definitely make comparisons with Atlassian, overseas I would make comparisons with companies like Spotify. It’s not directly in the same industry but definitely experiencing the same type of hyper-growth that Canva’s experiencing.”

Canva has added more users in the past 12 months than the previous six years.

Mr Obrecht said the company had been approached by special purpose acquisition companies that wanted to list the company, but he said there was no hurry for an initial public offering whether via a SPAC or directly.

“There’s no rush for us,” he said. “We’re profitable and we’re very fortunate that we can still find investors that align to our vision and values. I often say that we’re just one per cent of the way there with Canva.

“We have a huge vision to empower every team to achieve its goals through visual communication. We’ve still got a whole lot more to achieve and so no immediate plans for any public listing.”

Rick Baker, partner at Blackbird Ventures, said the private markets were now able to fund companies such as Canva through to a much later stage.

“Canva is not just the best tech company in Australia at the moment, but one of the very best in the world,” he said. “When you look at the best Saas [Software as a service] companies in the world they are growing at a half to a third of Canva’s rate.”

Mr Baker said Canva was in a class of its own on a world stage particularly as it has achieved its fast growth while also being profitable. “Most big US Saas companies are burning millions of dollars driving that growth and Canva has done that in a way that is very efficient,” he said.

Christian Jensen, partner at Dragoneer, said Canva was nimble and passionate and it was incredible what it had been able to achieve in such a short period of time.“We believe that there are only a small handful of truly special companies being built at any given moment - and Canva is one of them,” he said.

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