Airtree Ventures’ Investment Journey with Canva: A Look Back
In 2015, Airtree Ventures, a venture capital firm based in Sydney, made a significant move by investing in Canva’s Series A funding round, which was worth $6 million. At that time, Canva was still a budding design platform, and this investment marked the beginning of a fruitful partnership with one of Australia’s most recognized tech companies.
Understanding Canva’s Model
Canva was co-founded by Melanie Perkins, Cliff Obrecht, and Cameron Adams and launched in 2013. The platform revolutionized graphic design by making it easy for anyone, even those without a design background, to create stunning visuals. With user-friendly features like templates and drag-and-drop tools, Canva quickly gained popularity and later expanded its offerings to cater to businesses and teams.
By 2021, Canva’s growth was impressive, reaching an astonishing valuation of $39 billion when Airtree decided to reduce some of its holdings. Later that year, Canva raised an additional $200 million, pushing its valuation to $40 billion.
A recent report from TechCrunch in April 2024 highlighted a new share sale of Canva that provided Airtree Ventures with a return of 1.4 times the total investment from its initial fund.
Airtree’s Strategic Holding
Despite selling part of its investment, Airtree chose to keep the majority of its stake in Canva. This strategy allows the firm to benefit from any future growth in Canva’s value or potential exits, such as a public offering.
The Reason Behind Partial Sales
Craig Blair, co-founder and partner at Airtree, explained that the firm aims to generate returns for its investors throughout the life of the fund. Instead of waiting for a full exit, such as through an acquisition or an IPO, Airtree uses partial share sales to provide liquidity while keeping the door open for future profits.
How Partial Sales Work
The strategy employed by Airtree involves secondary sales. In this scenario, existing shareholders, rather than the company issuing new shares, sell some of their shares to new buyers. This process not only allows early investors to recoup part of their investment before the company goes public but also plays a key role in the overall investment strategy.
By maintaining a careful balance, Airtree Ventures continues to support Canva while capitalizing on the company’s impressive trajectory in the tech landscape.
