Canva’s value soars after ‘brutal’ blow

Like many big tech companies in the world, Canva has had a rough year amid the market downturn which has seen its valuation slashed by 44 per cent.

But in what might be a sign of the tech crisis becoming more manageable, one of the venture capital firms that put money into Canva has increased its best estimate for the company’s overall worth.

Canva just rose in value by nearly 22 per cent.

In a filing with the US regulator last week, prominent multinational investor Franklin Templeton brought up its original estimate.

That’s good news for Canva, which has been hit with multiple mark downs this year by Franklin Templeton, and admitted to a “brutal” market which saw a $20 billion drop.

Canva was founded by Perth sweethearts Melanie Perkins and Cliff Obrecht, alongside Tasmanian developer Cameron Adams, and went on to garner 85 million monthly active users across 190 countries, with over 3000 employees.

At its peak last September, the Aussie business was valued at a staggering $54.5 billion with that impressive figure meaning the unicorn had more than doubled its worth since April 2021, when it was valued at an estimated $19 billion.

Franklin Templeton was the first to sound the alarm over Canva getting caught up in the tech crash.

All the way back in April, it valued Canva at $19 billion, reducing the cost of its 11,829 Canva shares from $28.2 million to $18.7 million.

Overall, that represented a drop of 33.5 per cent – roughly one-third – of Canva’s overall value. As of August, that figure was accurate, indicating Franklin Templeton was ahead of the curve.

News.com.au has contacted Canva for comment.

With Franklin Templeton leading the charge in April, other venture capitalist firms also revised their estimates and brought it down.

Again, this could be a sign that the others might fall into line and revise up their valuation estimates.

In July, Australia’s largest venture capital firm Blackbird reduced the holding value of Canva by 36 per cent – a drop of about US$14 billion or A$20 billion at the time.

““After an exuberant period in 2021, the public markets have been brutal on tech companies,” Blackbird said of its decision.

A month later, global investment company T. Rowe Price revealed it had knocked 30 per cent more off Canva’s valuation.

The current market conditions has seen many tech companies, big and small alike, cut jobs or go under as they struggle to stay afloat in the turbulent market.

Earlier this month, delivery giant Deliveroo’s Australian branch went into administration as the firm failed to turn a profit. Also in the past month, cryptocurrency exchange FTX filed for bankruptcy.

In August, news.com.au reported on a governance and risk management tech firm called FirmGuard which went bust owing $2.3 million to creditors.

Later that same month, an Aussie quit his job of six years to work at a tech start-up called Zenbly but he was devastated to learn there was no job for him to go to as the new firm had been liquidated.

Then there was Metigy, an artificial intelligence platform, which made headlines for owing an eye-watering $32 million to investors due to its collapse.

A Melbourne-based e-sports company called Order, which raised $5.3 million in funding last year, also collapsed with liquidators seeking to sell the business urgently.

In July, Australia’s first ever neobank founded in 2017, Volt Bank, went under with 140 staff losing their jobs, while 6000 customers were told to urgently withdraw their funds.

Other failed businesses include grocery delivery service Send, which went into liquidation at the end of May, after the company spent $11 million in eight months to stay afloat and a Victorian food delivery company called Delivr that styled itself as a rival to UberEats also collapsed in July as it became unprofitable.

Many Australian tech firms have also slashed their workforces in the hopes of saving money.

Cryptocurrency exchange Swyftx sacked one in five of its staff in August while a Brisbane-based business a telecommunications and IT infrastructure company called Megaport revealed that a whopping $1.6 million was spent paying out the 10 per cent of employees who had been made redundant.

An Australian social media start-up called Linktree that was recently valued at $1.78 billion sacked 17 per cent of staff from its global operations.