Last summer, Blackbird, one of Australia’s largest venture operations, marked the value of one of its most expensive stakes, Sydney-based design platform Canva. Valued at $40 billion by investors in a $200 million round in the fall of 2021, Blackbird adjusted its own company valuation 36% to $25.6 billion.
Now, T. Rowe Price – the mutual fund Goliath that started aggressively investing in late-stage startups nearly a decade ago, continues to fund them throughout the pandemic, and is leading a $40 billion round in 2021 – indicates the amount of its stake. in Canva more modestly, adjusting it to a whopping 67.6%. (T. Rowe’s Blue Chip Growth Fund, which owns some classes of Canva shares but mostly Series A shares, currently has $99.1 million invested in Canva and says in its latest prospectus, dated March 31, it now values those shares on a cost-adjusted basis at $32.1 million.)
Asked for comment earlier today, a Canva spokesperson downplayed the number, writing in an email: “As a profitable company with healthy cash reserves, we are in a fortunate position to continue to focus on building a sustainable company in the long term. Regardless of the macroeconomic environment, we are well positioned to continue doubling down on key initiatives, including growing our team and expanding our product and AI innovation efforts.
The spokesperson added, “We’ve experienced rapid and rapid growth across all of our metrics, recently surpassing 135 million monthly active users. Canva’s valuation is imprecise based on any single investor. alone, and with our growth and pace of new product launches, we are confident that regardless of market conditions, we will exceed our last estimate as markets. right and our growth continues .”
T. Rowe’s investment in Canva represents a small amount of money for the expanding investment firm. Its Blue Chip Growth Fund had roughly $53 billion in assets under management at the end of the first quarter of this year, up from $63 billion last year, as of June 2022.
However, it turns out that one of the safest asset managers in the US thinks that a company that at one time was the fifth most valuable startup on the planet is now worth less – in fact $ 13 billion and not $ 40 billion.
Asked whether Canva adjusted its own, independent 409A valuation to match T. Rowe’s assessment — T. Rowe’s rating is really just its opinion, after all — a Canva spokesperson said the T. Rowe’s investigation did not match this but declined to comment further.
Of course, Canva is far from alone in being highly rated by its backers after climbing to a new high in valuation in 2021. % to $6.7 billion, from the $45.6 billion valuation assigned to it in 2021 .
Klarna, which actively accepted its devaluation, has since tightened lending standards and cut costs, including through repeated layoffs, and said it was now “strongly on track ” to reach the monthly profit in the second half of the year.
Like many other outfits today, both companies are actively changing to – and looking to take advantage of – generative artificial intelligence.
In a press release late last week, Klarna credited some of its current momentum to OpenAI, saying that an integration with its large language model is “accelerating Klarna’s evolution to a digital financial assistant.”
In an effort to maintain its leading position in the world of graphic design collaboration, Canva is also integrating generative AI throughout its product line, telling Fast Company in March that much of what has been infused throughout the house has been built for a long time. term investment and acquisition.
Although Canva also relies in part on major language models — using them sparingly, its spokeswoman says — co-founder and CEO Melanie Perkins told FC that it intentionally relies less on work of others so that it can promise users that “whatever you are, make Canva yours.”
Its customers seem to like what they see. According to Canva, more than 200 million images have been created with the text-to-image offering, more than 1 billion words have been written using the AI text generator, and nearly 2 billion backgrounds have been removed using the background removal product.
As for the impact of AI on Canva’s valuation in the future, that remains to be seen. While public shareholders will eventually decide what they think the company is worth, an offer isn’t forthcoming, not yet.
Asked about a possible IPO, a Canva spokesperson said today that there are no plans in sight. Meanwhile in March, Canva co-founder and COO Cliff Obrecht (who is married to Perkins), suggested to Barron’s that this is now the best idea for the 11-year-old company.
“It’s not the right market to come out right now. But obviously, it’s going to be inevitable at our size,” he told the outlet. “It’s on the horizon, but not on the immediate horizon.”