Will Canva Have an IPO Soon?

February 1, 2023 3:00 pm
Published by: Lucien Paulemil

With over 100 million active users a month in over 190 countries, Canva is arguably the most popular free-to-use online graphic design platform in the industry. To date, around seven billion designs have been created on the platform in more than 100 languages.

Following its most recent funding round, the company's valuation rose to a staggering $40 billion. This has led investors to believe that Canva is planning to go public in the near future. But when? Will Canva have an IPO soon, or is it all wishful thinking?

At the time of writing, Canva has yet to announce its intention to go public. Some predict that it may happen sometime in 2023, but there's no official confirmation yet. 

This article discusses everything you need to know about Canva's IPO, including why the IPO could be imminent. Let's get right into it!

Brief History of Canva's Growth and Financial Success 

For nearly a decade, Canva has been the go-to graphic design platform for both casual and professional users alike. 

Available in nearly every platform, the app's intuitive drag-and-drop interface allows even the most inexperienced users to create amazing designs in mere minutes—and for free. 

Canva's rise to success isn't an easy one. According to founders Cliff Obrecht and Melanie Perkins, the project faced over 100 rejections before it was given a chance. Through persistence and patience, Canva eventually secured a $3 million seed round in 2013. 

The company's first year was a smashing success, garnering over 750,000 users in several months. 

In April 2014, Canva welcomed marketing specialist Guy Kawasaki as its chief evangelist to help Canva expand globally. And expand, it did. 

As investments started flowing in, Canva slowly but surely became a household name in the industry. Its revenue increased from $6.8 million in 2016 to $23.5 million in 2017. 

In 2018, Canva raised $40 million from Blackbird Ventures, Sequoia Capital, and Felicis Ventures, raising its valuation to $1 billion. In October of that same year, the company raised an additional $85 million, pulling its valuation to $3.2 billion.

Here's a summary of Canva's funding history:

● 2015: $27.6 million 

● 2016: $16 million 

● 2018: $25.3 million 

● 2019 (May): $91.3 million 

● 2019 (October): $86.7 million 

● 2020: $70 million 

Today, Canva's valuation sits at an impressive $40 billion from its $6 billion valuation in 2020. It has over 100 million monthly users from across 190 countries. 

Will Canva Have an IPO Soon?

With a valuation of $40 billion, Canva has attracted the interest of investors across the world. However, the company has yet to announce its intention to go public, if ever at all.  

"Our most recent funding isn't a pre-IPO round," CEO Melanie Perkins said in an interview. She also stated that a listing was "not top of mind," confirming that the company isn't planning to have an IPO soon.

Co-founder Cliff Obrecht backed Melanie Perkins's claims in a separate interview. "We don't have any plans to IPO on the immediate horizon," he said. "We're more focused on growing the business." 

According to Obrecht, there are two reasons for a company to go public: to raise money and for liquidity. The company claims to easily achieve both in the private market, so there's no reason for them to go public just yet.  

That said, neither Perkins nor Obrecht ruled off the possibility of a public listing. It may not happen anytime soon, but we never know what the future brings. Though for now, investors

shouldn't hold their breath for a Canva IPO. 

Why a Canva IPO Could Be Imminent 

There are several reasons why a Canva IPO could be imminent. These are as follows:

Explosive Growth

In just under a decade, Canva has become one of the most influential design platforms in the world. It has over 100 million monthly active users that create an average of 150 designs per second. 

Canva has changed the way people create designs for work and personal projects. If nothing else, it empowered amateurs to pump out professional-looking visual content without sacrificing an arm and a leg, be it a TikTok video, a family holiday card, or an ad campaign. 

Even professionals deem it as a crutch. It might not be as intuitive or feature-packed as, say, Adobe Photoshop, but it's still considered a great all-around tool for casual users.

Canva's growth is likely to continue as it expands its product line. Once the company reaches its target goal, it may consider going public. 

New Source of Capital 

IPOs allow companies to raise capital quickly and effectively, allowing them to use the cash to further the business. 

Canva doesn't have issues raising funds at the moment, but that could change with a single big project. 

Cliff Obrecht confirmed that the company is "maniacally focused" on growing the business, so there's a possibility that they might need more funds than they currently have in the future. 

Listing the company on the public market can easily solve potential financial issues the company may have. 

Major Event for Australian Startups

Canva is one of Australia's biggest and most valuable startups. 

If it goes public on the stock exchange, it'll be the largest tech IPO the country has seen in years. 

It'll make waves in the Australian startup ecosystem, which will likely boost the company's already rising popularity more. 

Risks Associated With Canva IPO 

Despite the benefits of going public, there are an equal number of risks associated with it. 

Fierce Competition

Though extremely profitable, it isn't as "fool-proof" as some of its closest competitors. Seasoned graphic designers stay loyal to Adobe's paid software suite. Some go as far as to say that one can never truly be a "professional" graphic designer if one only uses Canva. 

Low Investment Return

Canva pledges away the vast majority of its stakes to charitable institutions like the Canva Foundation and GiveDirectly. 

"We've always felt that we're purely custodians of it," Perkins said in a Forbes interview. 

Canva has never planned to "hoard" its wealth—nor will it ever, she says. This act may scare off potential investors, as they might not see a massive return on their investment. 

Divided Attention on Improvement

Launching an IPO could prove to be time-consuming and distracting to a budding company like Canva. If the company focuses on its IPO, it could lead to setbacks and missed opportunities. 

Compared to other IPOs, Canva is a "small" company with only about 2,000 employees. Listing the company in the market might be too much at this moment in time. 

Devaluation Upon Release

The stock market could "devalue" the company upon its public release, leading to a down round. This might hurt the company significantly. 

So, what's the future of Canva? Only time will tell. What we know is that once Canva lists itself on the stock exchange, it'll be a major event for Australia and the stock market as a whole. 

How to Trade the Canva IPO

Canva is a private company, so you won't be able to trade or exchange Canva stock just yet. The company could start the IPO process with the Securities and Exchange Commission at any time, but with the market's current volatility, that might not happen in the upcoming months. 

If—or rather, when—Canva goes into the public market, you'll be able to buy stock with the Nasdaq exchange or the New York Stock Exchange through an online stock broker.  

But for your best chance of getting involved in Canva early sign up to eToro or Switchmarkets, they deal with new issues regularly and they will enable you to get involved very early on.

Here's how to get started: 

● Create an online account with a eToro or Switchmarkets as they will make Canva available to you at the earliest possible opportunity.

If you are based in the US then register with eToro to gain access to Canva early by clicking here. 

For the rest of the world sign up to eToro with this link, unless you are in India or Canada then sign up with Switchmarkets here, you can register your interest in the stock and they will tell you as soon as it is available. 

Canva isn't likely to go public in 2023, but that isn't particularly a bad thing. Those planning to invest in Canva will have more than enough time to analyze the company's financial history before committing to the investment. 

When the IPO is released, Canva will publicize its quarterly financial statements to allow an even better insight into the company's funds and cash flow. 

While you can't buy stocks in Canva just yet, you can indirectly invest in the company through its parent company, Square Inc. (NYSE: SQ). 

Square acquired Canva for $1.77 billion in August 2020. It's been on the New York Stock Exchange since November 2015 and has raised a funding of $601.2 million over ten rounds. 

At the time of writing, it has a valuation of $2.9 billion.

How to Invest in Canva Pre-IPO 

Investing in pre-IPO stock is generally not recommended for individual investors due to its high risk. 

There's no guarantee that the stock will perform well before the company goes public, so you might not get the returns you might expect. If Canvas performs terribly in the market, the stock bought pre-IPO will lose value rapidly. 

Furthermore, pre-IPO investment is highly susceptible to fraud and illegal offerings. 

Getting involved with them before the listing will be difficult for retail investors.

Your best bet is to sign up to a platform such as eToro or Switchmarkets using the links above as they will make Canva stock available to you at the earliest possible opportunity.

Wrap Up - Will Canva have an IPO soon?

Canva has yet to announce its intention to go public. 

In previous interviews, founders Melanie Perkins and Cliff Obrecht have made it known that the company isn't planning to have an IPO anytime soon—if at all. 

According to them, Canva has more than enough funds to keep it afloat during unexpected difficulties, so they don't see any reason to place it in the stock market as of yet. 

Nevertheless, Canva's decision may change at any point in time. The founders haven't wholly ruled off the possibility of an IPO, just that it won't happen soon. Once Canva goes public, it'll undoubtedly be very popular.

The information in this article is well-researched and factual. Still, it contains opinions also, and IT IS NOT FINANCIAL ADVICE and should not be interpreted as such, do not make any financial decisions based on the information in this article; we are not financial advisors. We are journalists. You should always consult with a professional before making any investment decisions.

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