Canva: Analysis of Australian Entrepreneurs, Venture and Marketing

This report provides an in-depth analysis of Canva, the Australian graphic design platform founded by Melanie Perkins and Cliff Obrecht, along with co-founder Cameron Adams. It examines Canva's venture creation, highlighting the identification of a market opportunity stemming from the complexities of existing design software and the founders' prior experience with Fusion Books. The report delves into Canva's value proposition, emphasizing its user-friendly design interface, wide range of templates, and adaptability for various user needs, from individuals to large enterprises. Furthermore, it explores Canva's entrepreneurial marketing and finance strategies, including its initial 'word of mouth' approach, the freemium model, and the role of influencer advocacy. The report also discusses Canva's financial journey, from initial seed funding to its recent valuation. The report concludes with a recommendation for Canva to expand its reach, focusing on marketing and product development tailored to the younger generation, such as templates for platforms like TikTok and Zoom, to ensure its long-term success.

Assignement two Canva- australian entreprenures
Introduction
Canva is a free graphic designing platform that allows users to develop projects which range from
business marketing materials to logos and social media posts (Demarest, 2020). Melanie Perkins and
Cliff Obrecht along with co-founder Cameron Adams launched Canva in early 2013, successfully creating
a platform that didn’t require any experience or extensive graphic designing knowledge (Peck, 2021). In
the ongoing pandemic, the company has experienced an increase in valuation - from $3.2 billion in late
2019 to $15 billion in 2021 – and its services adopted for “for online education, public health
presentations, and by the scads of workers, now remote, needing to create online presentations to
communicate with colleagues” (Fry, 2021). Currently, Canva serves its products and services to 190
countries (Lee, 2021).
Products and Features: Canva works towards providing free and paid templates to create a variety of
designs that range from presentations to posters. Along with the world, the platform’s activities have
shifted from printable designs to a digital reality (Fry, 2021). In 2019, Canva had released Canva Video
product, providing video templates along with editing and cropping tools, already building towards the
boom in online video consumption. In April 2021, they released a presentation tool, which is adaptable
to smartphone and allows teachers and businesses alike to prerecord presentations or present live
(Bailey, 2021).
Customer base : The platform’s target audience ranges from individuals who have access to a variety of
their free templates and photos, to enterprises which caters to teams of more than 20 people and need
design and communication tools at scale with advance security (“A perfect fit for every team,” n.d.).
Problems targeted : During her university days, Melanie Perkins noticed her peers’ experiencing
difficulties while trying to adapt to Adobe Photoshop. “Even after a semester of university (they) still
struggled with the complex program” (Peck, 2021), inspiring her to produce Fusion Books, which
allowed students to create yearbooks with a simple drag-and-drop function. This acted as catalyst for
creating Canva in 2013 along with her partner Cliff Obrecht (Peck, 2021). Canva now continues to target
issues and exploit markets which arise from pandemic and post- pandemic demands such as online
studying and marketing.

New Venture Creation
Shane and Venkataraman (2000) define opportunity recognition to be “circumstances in which new
goods, services, raw materials and organizing methods can be introduced and sold at greater than its
production cost”. These circumstances often arise due to the emergence of new information within the
market, the customer-market needs being unmet or both (Kuckertz, Kollmann, Krell, & Stöckmann,
2017). However, following recognition, an entrepreneur must decide to exploit this opportunity. In this
process, evaluation of the recognized opportunity involves assessing whether the business idea
correlates to the individuals experience, capabilities, and knowledge (Kuckertz, Kollmann, Krell, &
Stöckmann, 2017). While exploitation involves planning a business model, developing the
product/service, and gathering resources. (Kuckertz, Kollmann, Krell, & Stöckmann, 2017).
As mentioned above, Perkins recognized an opportunity when her peers struggled to understand
complex programs such as Adobe and Microsoft (Browne, 2020). She along with Obrecht recognized this
business idea due to the customer needs, particularly the ease of using designing programs, not being
met by the limited platforms offered in the market. Furthermore, with their experience with Fusion
Books and online designing platforms, and Perkins’ own entrepreneurial experiences early in her career
allowed them to successfully evaluate the profitability of developing Canva (Peck, 2021). In the
exploitation stage, the couple focused on gaining prominent investors to develop Canva and transform
from the niche product offered by Fusion Books , this is when the company offered tech expert Cameron
Adams to become one of their co- founders (Peck, 2021). They began with simply offering designing
elements such as stock photography, graphic elements, and fonts (“Names with stories: The story
behind Canva.com,” n.d.) to a selected number of professionals to gather feedback and make any
corrections before making the site public (Schroder, n.d.). Canva gathered 750 000 users in its first
year(Campbell, 2014). Following this, Canva received enough funding to release Canva for Work in 2015
expanding in more marketing materials (Locker, 2018).

Venture Value Proposition
The value proposition of a venture aims to describe the product/ services it provides and form a nexus
to the benefits of the products and the various customer segments it addresses (Ladd, 2018). Canva
aims to address the universal need for design by casual users (students, job seekers etc.), professionals
(Marketers, social media influencers etc.) and small and large enterprises.
The ease of using Canva has brought the company’s products’ value to the limelight. When customers
visit the site, they see a simple layout with design prompter and various templates. The company started
with the vision of creating design that is adaptable for subjective needs without any friction
(Vivekananda rajah, 2021) and it has continued to deliver that. Guy Kawasaki, who joined Canva two
years into their company as their chief evangelist, believes “that design becomes an essential element in
communication as it makes you stand out” (REACH OR MISS, 2021). This statement is reflected in
Canva’s 250 000 templates, which almost double with the paid services (HubSpot, 2021). The company
provides its customers with templates and optimizes its data based on the customer’s needs to offer
designs catering to the customer’s specific needs and increase the templates they offered creating more
value for the investors and the customers. Furthermore, Canva believes in improving its platform based
on data driven information. In an interview with WebProfits (2020), Dave Burson -Head of Product,
growth, and monetization at Canva - describes how it is important to look at both qualitative and
quantitative data in order to see what the company could improve one. Therefore, Canva has developed
their value proposition to address their initial goal; to provide a graphic designing platform that is easy
to use for everyone.
Entrepreneurial marketing and finance
Surpassing $500 million annualised sales with 55 million users and currently valued at $15 billion, Canva
has strong marketing tactics that has led to its success. In terms of entrepreneurial marketing (EM),
Morrish, Miles, & Deacon, (2010) suggest that EM is an integral in all stages of the firm’s lifecycle
whenever there is a need to exploit attractive opportunities. Balakrishnan, Dahnil, & Yi (2014) states
that the Word of mouth plays a major role in customer’s buying decision. Initially, Canva’s focused on
the “word of mouth” marketing, which is their main source of customer acquisition, and customer
journey (Dasgupta, 2021). The company approaches the customers with a conversation about the
challenges they face while designing (Dasgupta, 2021). Following the release of their paid content in
2019 (Crook, 2019) called Canva Pro, that allowed a 30 day trial, the freemium model became appealing
within the market as it allows the customers to not only use the free content but to try out the paid
which was paired with an increase in products and features that was appealing to companies and teams
(Sethi, 2021). In addition, once in a while, the company has had its share of influencer advocacy, around
the second anniversary for the company, Canva acquired Guy Kawasaki as their chief evangelist, the
company almost doubling their users (REACH OR MISS, 2021). In 2020, Canva released an online design
course, named Design School. Similar to courses provided by companies such as Google, Canva aims to
teach anyone interested to “better articulate ideas and inspire action” (Kitschke, n.d.)

Canva started with an initial investment of $3 million from Silicon Valley in 2013 (Pecks, 2020) However,
before Perkins could get to this stage, she had been turned away from more than 100 investors. Soon
after Guy Kawasaki joined the company “Canva raised $3 million in seed funding last year from Matrix
Partners, InterWest Partners, 500 Startups, and angels, including Google Maps founder Lars Rassmusen,
Bill Tai (Charles River Ventures), and Ken Goldman (CFO of Yahoo)” (Mishra, 2014), effectively launching
Canva for Work the following year for business to use as a collaborative tool. Mostly being funded by
investors, in 2016-17, an investment led by Sequoia China of $40 million was use to improve the
company’s presentation toolkit, effectively wanting to challenge the strong hold PowerPoint has on the
market (Sheiber, 2018). Keeping a similar pattern through the years, Canva recently has hit a USD$40
billion valuation of after announcing a USD$200 million raising led by T. Rowe Price and joined by
returning local investors Blackbird Ventures and AirTree Ventures. This valuation makes canva
Australia’s most valuable unlisted company (Bailey, 2021). It will be interesting to observe how Canva
plans to widen their customer base.
Recommendation
Marketing and developing products more directed towards the younger generation, not only to enhance
the business but to appeal to a wider consumer network. For example, templates catering to the
specifications of TikTok or Zoom backgrounds will ensure a higher chance of a stable customer base and
result in longevity of the company. Consumers seek products and services that will meet their needs and
wants…they have a higher commitment to and purchase intentions with services they recognize and
identify with (Z. C. Lee, Hodges, & Watchravesringkan, 2015).
References
1. Al-Saad, T. (2021, March 13). Canva’s Digital Growth Strategy. Retrieved from
https://www.webprofits.com.au/blog/canva-growth-study
2. Bailey, M. (2021a, April 7). Canva worth nearly $20b after fresh fundraising round. Retrieved
from https://www.afr.com/technology/canva-worth-nearly-20b-after- fundraising-20210407-p57h1o
3. Bailey, M. (2021b, September 15). Canva catapults to $55b value. Retrieved from
https://www.afr.com/technology/canva-may-be-australia-s-most-valuable-private- company-20210915-
p58rxk
4. Balakrishnan, B. K., Dahnil, M. I., & Yi, W. J. (2014). The Impact of Social Media Marketing
Medium toward Purchase Intention and Brand Loyalty among Generation Y. Procedia - Social and
Behavioral Sciences, 148, 177–185. https://doi.org/10.1016/j.sbspro.2014.07.032

5. Browne, R. (2020, June 23). Australian design app Canva doubles valuation to $6 billion and
plans U.S. expansion to rival Adobe. Retrieved from https://www.cnbc.com/2020/06/22/design-app-
canva-doubles-valuation-to-6-billion- plans-us-expansion.html
6. Campbell, R. (2014, September 15). The Problem With Going Into Business With a Friend.
Retrieved from https://boss.blogs.nytimes.com/2014/09/15/the-problem-with- going-into-business-
with-a-friend/
7. Crook, J. (2019, October 16). TechCrunch is now a part of Verizon Media. Retrieved from
https://techcrunch.com/2019/10/16/canva-now-valued-at-3-2-billion-launches-an- enterprise-product/
8. Dasgupta, P. (2021, April 9). Canva growth marketing story | CONVERGENCE. Retrieved from
https://medium.com/priyanka-dasgupta/growth-marketing-hacks-from- 6b-canva-b5dc5310e76d
9. Demarest, A. A. (2020, September 18). What is Canva? A guide to the graphic design platform’s
features and capabilities. Retrieved September 7, 2021, from
https://www.businessinsider.com.au/what-is-canva-2020-9
10. Fry, E. (2021, June 25). How Canva became an unexpected pandemic winner—and a $15 billion
business. Retrieved September 7, 2021, from https://fortune.com/2021/06/24/how- canva-became-an-
unexpected-pandemic-winner-and-a-15-billion-business/