Canva, one of the world’s most valuable all-in-one design platforms, has acquired generative AI content and research startup Leonardo.ai in a mix of cash and stock.
Canva did not disclose financial details of the acquisition, but an AFR report said the deal is worth over A$120 million (about $78.5 million). The deal will also see Leonardo.ai’s 120 employees joining Canva.
The acquisition is considered strategic for Canva as Leonardo.ai has become the hottest AI design startup in the country and could challenge the global design powerhouse in the near future.
In a statement, Leonardo.ai said it would be supercharging with Canva’s backing and accelerate its pace of innovation.
“We will be scaling up our research capability in a big way, expanding our global research team to enable them to work across many modalities and tackle more problems at speed,” the AI design startup said.
Leonardo.ai was founded in 2022 to originally focus on video game asset creation. Based in Sydney, the startup decided to build out the platform and create AI training models to design images across the fashion, advertising, and architecture industries.
“From the early days of easy model finetuning and customizable settings, we’ve been moving at pace to break new ground in the gen AI space, with a focus on providing exceptional control, speed, and quality,” Leonardo.ai added.
Leonardo.Ai reportedly raised $31 million in December last year from investors including Australia-headquartered Blackbird Ventures and Side Stage Ventures as well as US-based Smash Capital and TIRTA Ventures.
Last year, Canva launched a $50-million fund to invest in app developers who will build on the Canva apps marketplace. The fund, Canva Developers Innovation Fund, invests in creative, innovative app developers and helps them bring new experiences to the Canva community.
Co-founder and CEO Melanie Perkins and her team started working on Canva in 2012 and launched the product in 2013. The platform allows users to make posters, social media graphics, presentations, and more by providing presets and templates.
It was valued at $40 billion in September 2021 after raising $200 million in a funding round led by investment management firm T Rowe Price.
Canva’s acquisition of Leonardo.ai will likely be reviewed by the Australian Competition and Consumer Commission in line with Australia’s new merger laws that focus partly on stopping big tech companies from buying startups.
