Australia’s Canva brings AI-powered design to Europe 2023

Canva, an Australian graphic design startup expanding into Europe, feels it is “uniquely strong” to weather market challenges.

The Sydney-based software startup established its new Europe headquarters in London this month to compete with Adobe and Microsoft for individual and enterprise design suite users.

Tech corporations have cut employees over the past year due to increasing borrowing rates and a deteriorating economy. Co-founder and CEO Melanie Perkins said the nine-year-old firm is well-positioned amid larger difficulties.

Perkins told CNBC that being profitable for six years and having a solid cash balance were crucial.

In the year to May, Canva’s yearly revenues were $1.5 billion. The corporation reported $700 million cash reserves.

Europe has 16% of its 135 million users. 15% of subscribers are paid, including 14 million individuals and 6 million organizations like WPP, Unilever, and Rolls Royce. It currently seeks growth in both.

“We’ve made our paid products extremely affordable, so regardless of what’s happening in the macroeconomic environment, people are moving to Canva rather than away,” Perkins said.

As economic uncertainty has increased, “We’ve certainly seen that happen and play out over the last couple of years,” she said.

“Magic” AI betting

Canva, a 2023 CNBC Disruptor, has experienced industry hurdles.

The private company’s worth has fallen from $40 billion in 2021 due to the deteriorating outlook. In March, Silicon Valley Bank collapsed, narrowly avoiding blame.

Meanwhile, the firm’s release of a new suite of AI-powered editing, publishing, and design tools drew 10 million new users in a month amid rising criticism of AI. It calls the tools “magic” amid the technology’s hype.

“That term ‘magic’ has been what we’ve referred to things as for almost a decade,” Perkins added.

Tesla CEO Elon Musk and OpenAI CEO Sam Altman have raised worries about the risks AI poses to civilization.

Magic Write, Canva’s OpenAI-powered tool, builds entire presentations and blogposts from a few lines. Perkins said the corporation is carefully “over-indexing towards trust and safety.”

Magic Write cannot do many terms. No medical, political, or other categories since they’re too hazardous. Because this business is so young, we’re being cautious,” she added.

Creative evolution

Some systems may already create pictures and information designed by designers, putting the creative profession at danger.

Perkins claimed the tools will “supercharge” design processes by simplifying and streamlining them.

Every industry changes drastically. “Our industry’s not far from that,” Perkins added. As new technology emerges, the entire sector must adapt and gain new skills. It’s occurred repeatedly.”

People thought Canva would kill graphic design, but it hasn’t. She noted, “Graphic design and visual communication are much more prevalent and demanded across all organizations.”

The company hopes to reach 1 billion users and become one of the world’s most valuable by its 10th anniversary in August.

Perkins was optimistic about meeting that user target in the coming decade. She was less candid about an IPO. “Nothing,” she said.

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