On a steamy May morning in 2013, Canva CEO Melanie Perkins found herself adrift on a kiteboard in the channel between billionaire Richard Branson’s private Necker and Moskito islands.
Her 30-foot sail floating deflated and useless beside her in the strong eastern Caribbean current, the 26-year-old entrepreneur waited for hours to be rescued. As she treaded water, her left leg scarred by a past collision with a coral reef, she reminded herself that her dangerous new hobby was worth it. After all, it was key to the fundraising strategy for the design-software startup she’d cofounded with her boyfriend six years before.
Canva was based in Australia, thousands of miles from tech’s Silicon Valley power corridor. Getting a meeting – much less funding – was proving tough. Perkins heard “no” from more than 100 investors. So when she met the organizer of a group of kitesurfing venture capitalists at a pitch competition in her native Perth, Perkins got to training. The next time the group met to hear startup pitches and potentially write crucial early-stage funding checks, she’d have a seat at the table – even if it meant having to brave treacherous waters.
“It was like, risk: serious damage; reward: start company,” Perkins says. “If you get your foot in the door just a tiny bit, you have to kind of wedge it all the way in.”
Such perseverance has long been a necessity at Canva, which began as a modest yearbook-design business in the state capital of Perth on Australia’s west coast. From those remote origins, Canva has grown into a global juggernaut. Twenty-million-plus users from 190 countries use the company’s “freemium” Web-based app to design everything from splashy Pinterest graphics to elegant restaurant menus. Besides an impossible-to-beat price (millions of users pay nothing at all), Canva’s key advantage over rival products from tech giants like Adobe has been its ease of use. Before Canva, amateurs had to stitch together designs in Microsoft Word or pay through the nose for confusing professional tools. Today, anyone, anywhere, can download Canva and be creating within ten minutes.
“It was like, risk: serious damage; reward: start company. If you get your foot in the door just a tiny bit, you have to kind of wedge it all the way in”
The company’s revenue comes from upselling to a $10-a-month premium version with snazzier features or, more recently, from sales of a streamlined corporate account option. High-quality stock photos – of which Canva has millions – cost another $1. It adds up. In 2019 the company more than doubled its revenue to $200 million; its most recent $85 million funding round valued it at $3.2 billion. Perkins, now 32 and an alum of the 2016 Forbes 30 Under 30 Asia list, has an estimated 15% stake, valued at $430 million. Throw in her 34-year-old cofounder – and now fiancé – Cliff Obrecht’s similar stake, and the Aussie power couple are likely worth more than $800 million.
In an era of billion-dollar checks from SoftBank and high-profile profligacy at WeWork, Perkins and Obrecht do things differently. They are couch surfers who prefer budget trips to private jets. (This summer, with Canva already valued at more than $2 billion, Obrecht proposed to Perkins in Turkey’s backpacker-friendly Cappadocia region with a $30 engagement ring.) Rarest of all: Canva says it’s been profitable – at least using the favored startup metric of adjusted EBITDA, which strips out stock-option expenses, financing and tax costs – since 2017. “We have been really conscientious about not taking on too much capital because we’ve been profitable for the last two years,” Perkins says.
The Aussie power couple are likely worth more than $800 million
It all starts with Perkins, who onboards every new employee (now 700 in total) with a thorough rundown of Canva’s most sensitive financial numbers and past investor pitch decks. Other unicorn founders boast. Perkins keeps receipts. And as Canva grows she’s trying to prove you can build a global tech giant from anywhere. “Melanie is a rare breed of entrepreneur, the likes of which you don’t find often anywhere,” says Mary Meeker, a seasoned internet investor whose new firm, Bond Capital, made Canva its first official investment in May.
Perkins’ family jokes that she has a 100-point plan for changing the world. First, Canva has a much more straightforward challenge: win over big business. Like Atlassian, Slack and Zoom before it, Canva faces a classic dilemma: a freemium model can make you viral, but most users will never pay a dime.
And though Canva says it has users inside almost every large corporation today, they’re typically rogue individuals or small teams, not official corporate accounts. Moving upmarket means increasingly brushing up against Adobe, the $149 billion (market cap) graphics giant that took in $1.65 billion in revenue last quarter from its design-focused unit alone. Then there are a host of high-flying startups like Figma and Sketch that cater to pros but could easily move into the consumer space. And that’s not even considering Canva’s ambitions in new mediums like video and presentations, which could pit it against everything from small Instagram video-making apps to Microsoft, maker of the blockbuster PowerPoint.
It’s daunting, to say the least, but for Perkins, who has already turned doubting Silicon Valley players into eager supporters and mastered the Chinese market – and has built a $200 millionplus bank account – it’s all according to plan. “I feel like we’ve done an incredible job, but we’ve done very little compared to what we want to do. We’ve done 1% of what I think is possible,” Perkins says. “Our company mission is to empower the world to design. And we really mean the whole world.”
Source: Forbs