The key facts
- Canva is cutting 22% of its workforce — 1,271 people will lose their jobs, change roles, or relocate
- Growth has slowed for the first time in ten years; the revenue forecast was lowered from 30% to 20%
- The company's valuation was lowered by investors to roughly $35 billion amid high AI spending
The biggest shake-up in 13 years
Canva, one of Australia's best-known startups, has announced a reorganization that will affect 22% of its workforce — 1,271 people. As reported by BBC News, co-founder and CEO Melanie Perkins, in a letter to employees, called this moment 'without a doubt the hardest in the company's thirteen-year history.' Some people will lose their jobs, while others will be asked to relocate to centralized hubs or change roles. TechCrunch notes that the company is merging its product, growth, and platform teams to reduce friction in communication, and is cutting back on 'sub-specialization' — employees will have to take on more responsibilities.
Slowing growth and AI pressure
Perkins admitted that 'this has been our hardest year, and as we reported earlier this year, our growth has slowed for the first time in a decade.' According to TechCrunch, Canva lowered its revenue growth forecast from 30% to 20% due to rapidly rising AI costs. The company is developing its own AI models to reduce expenses and dependence on third-party solutions, but this has not yet stopped the cost increases. The publication also points to growing competition from AI startups and general-purpose chatbots like ChatGPT and Gemini, whose image-generation capabilities make it easy to create posters and presentations — precisely the segment on which Canva's product is built.
The company's valuation has declined
The financial pressure is also reflected in the company's valuation. BBC News reports that investors Blackbird Ventures and Airtree earlier this year lowered Canva's valuation from A$60 billion ($41.8 billion) at the end of last year to roughly A$49 billion; TechCrunch cites a figure of about $35 billion. The figures differ across publications, but the direction is the same: investors have revised the company's value downward. The BBC also notes that Canva reduced its own internal valuation amid high AI costs associated with launching new products.
What changes for employees
Beyond the layoffs, the work model is changing. Canva has employees in 37 countries; Sydney will become the 'primary home' for more product teams, and starting next year, hybrid workers will have to spend two to three days a week in the office. For context: Canva was launched by Perkins in 2013 as a platform that allows people without design skills to create professional graphics — from wedding invitations to business presentations. Now, according to Perkins herself, 'new technologies are changing what people can create, how they do it, and what they expect from products.'
Image source, Getty Canva co-founder Melanie Perkins says this year has been 'our hardest' yet
