Archeology of 0 to 1: Canva breakdown
Introduction: The purpose of this research is to understand how a now well-established product like Canva was able to emerge in the market in the first years of its life. We will try to uncover the channels and the choices that were made to take the company and the product where they are today. And which of them can be repeated to bring a new product to the market.
Founded in 2013 by Melanie Perkins and Cliff Obrecht, the latest announcement gives Canva a USD 40 billion evaluation following a USD 200 million investment confirming it as one of the fastest growing software companies in history.
As they state on their website: “Canva is an online design and publishing tool with a mission to empower everyone in the world to design anything and publish anywhere.”
The first thing I can’t avoid noticing is that their mission statement is very human-centered like the one of many other successful companies. I might be biased but I truly believe that a vision built like that contributes tremendously to the success of the company.
“Canva, which has more than 55 million monthly active users, said it achieved a 130% year-over-year rise in annual revenue while remaining profitable.” says Reuters
So let’s go back and see what we can find.
2012: The beginning (?)
This screenshot is actually from March 2013 but the first trace of “joining the waiting list by reserving your username” (my own words for the record) I can find is dated June 2012. I’m not sharing the screenshot because honestly it doesn’t look good, but it is basically the same thing.
As they state on their website: “Canva is an online design and publishing tool with a mission to empower everyone in the world to design anything and publish anywhere.”
The first thing I can’t avoid noticing is that their mission statement is very human-centered like the one of many other successful companies. I might be biased but I truly believe that a vision built like that contributes tremendously to the success of the company.
“Canva, which has more than 55 million monthly active users, said it achieved a 130% year-over-year rise in annual revenue while remaining profitable.” says Reuters
So let’s go back and see what we can find.
2012: The beginning (?)
This screenshot is actually from March 2013 but the first trace of “joining the waiting list by reserving your username” (my own words for the record) I can find is dated June 2012. I’m not sharing the screenshot because honestly it doesn’t look good, but it is basically the same thing.
They will be in this phase for a long time. We could assume that there was some beta testing involved, but on invitation only most likely. What I noticed here is that through the months the selected social media channels change. At some point, they only have Twitter and Facebook which is an interesting choice. Canva is a graphic tool. I would have assumed the “graphic” social media should be preferred. So Pinterest, Youtube and Instagram. But they go the opposite way. They might be definitely trying to test different marketing strategies? Their initial handle for Twitter was CanvaDesign.
So I went over and the account still exists but it has 0 tweets which to me means that they did have a social media presence just in case people looked them up but they didn’t really invest in social media as one possible route to market.
So I went over and the account still exists but it has 0 tweets which to me means that they did have a social media presence just in case people looked them up but they didn’t really invest in social media as one possible route to market.
Assumption 1: They initially didn’t focus on social media. And it makes sense. Unless you have already a decent audience it will clearly not bring any benefit. If you are starting right now on social media, don’t put it down organic reach in your go-to-market strategy.
Ok, let’s dig to see then how they got in front of their users and grew later.
I noticed that when they removed some of the social media another link appear and it is to their pressroom. I won’t post the screenshot of this change because it is exactly the same homepage as above just with the links changed.
When clicking on “pressroom”, this is where it takes me.
Ok, let’s dig to see then how they got in front of their users and grew later.
I noticed that when they removed some of the social media another link appear and it is to their pressroom. I won’t post the screenshot of this change because it is exactly the same homepage as above just with the links changed.
When clicking on “pressroom”, this is where it takes me.
Here we have a picture with their 3rd cofounder Cameron Adams that came aboard as CPO. But what’s more important is that here my journey in the past gets split in two different directions. The first one has to do purely with the idea and if you wish their MVP and it digs further into the past and the other one is to continue looking for how Canva acquired users and it goes further into the future.
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Back to 2007: An example of what everyone talks about
What attracts my eyes in the previous screenshot is the item “investors” on the left menu. By clicking on it I find a list of investors that feels never-ending. And it’s not friends and family. I counted 13 people and most of them are Venture Capitalists. One of them is Ken Goldman who at that time was the CFO of Yahoo! Inc.
We are talking of a moment where Canva was still in “waiting list”. So let me put this into numbers. It means 0 official users, let alone paying users. It surely deserves some more research.
19th of March 2013 Canva raises 3 million. Without any user. Getting even more interesting.
Reading further down the article
Reading further down the article
What catches my eye here: “Canva is a spin-off from Perkins’ previous startup, Fusion Books, an online publishing system for creating school yearbooks launched in 2007. That company, which she ran with Canva co-founder and COO Cliff Obrecht, currently has 10 percent of the Australian yearbook market and has more recently launched in New Zealand and France.”
And more: “With the Fusion Books platform (patent filed here), users are able to login and collaborate on not only the text of yearbook pages, but also the visual experience.”
This is a beautiful and living example of what Arvid Kahl (https://www.arvidkahl.de/) so amazingly teaches in his “The Embedded Entrepreneur.” Find an audience -> find the problem the audience has -> find a solution for the problem -> present the solution to the audience.
Disclaimer: I’m not affiliated. I genuinely think he has a point :)
In 2007 Melanie is a student at the University of Western Australia that makes some side money by teaching graphic design to other students. She picks up on the complaint of the students who find Photoshop and other tools too difficult to use (who can disagree???)This is when she had the idea of building a tool that would make graphic design easier and came up with the perfect market to sell it to.
And more: “With the Fusion Books platform (patent filed here), users are able to login and collaborate on not only the text of yearbook pages, but also the visual experience.”
This is a beautiful and living example of what Arvid Kahl (https://www.arvidkahl.de/) so amazingly teaches in his “The Embedded Entrepreneur.” Find an audience -> find the problem the audience has -> find a solution for the problem -> present the solution to the audience.
Disclaimer: I’m not affiliated. I genuinely think he has a point :)
In 2007 Melanie is a student at the University of Western Australia that makes some side money by teaching graphic design to other students. She picks up on the complaint of the students who find Photoshop and other tools too difficult to use (who can disagree???)This is when she had the idea of building a tool that would make graphic design easier and came up with the perfect market to sell it to.
Fusion Books allow the creation of yearbooks directly online. This is a world she knows well because she is a student. The business case is super simple. The User and Buyer profiles are also very simple. The go-to-market strategy could be as simple as going to knock on universities’ doors and tell them that by using your tool it will take them 30 minutes to create a wonderful yearbook for much less money than if they paid a professional to do it. Don’t you think they were happy to buy? It looks like they were.
So the founders started very small and validated their idea very well.
It took them 5 more years to start Canva. In an old interview, Melanie said that they always knew this could become big. What I also think happened is that they did what every company normally does at some point. They looked for new ways to expand their market because let’s face it there are so many Universities you can go to if you live in Australia :)
So this is how Canva was born.
Assumption 2: They first went very niche. Their initial TAM (total available market) was small but they were the only one at that point so they didn’t have to share it. Plus that built a strong use case for what came next. So I’ll repeat here what Arvid says. Join a community and find a problem you can solve as an insider instead of doing that as an outsider. And don’t be afraid of starting small. If you can, niche down. That will give you time to learn and save you money and headaches if it doesn’t work.
So the founders started very small and validated their idea very well.
It took them 5 more years to start Canva. In an old interview, Melanie said that they always knew this could become big. What I also think happened is that they did what every company normally does at some point. They looked for new ways to expand their market because let’s face it there are so many Universities you can go to if you live in Australia :)
So this is how Canva was born.
Assumption 2: They first went very niche. Their initial TAM (total available market) was small but they were the only one at that point so they didn’t have to share it. Plus that built a strong use case for what came next. So I’ll repeat here what Arvid says. Join a community and find a problem you can solve as an insider instead of doing that as an outsider. And don’t be afraid of starting small. If you can, niche down. That will give you time to learn and save you money and headaches if it doesn’t work.
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Fast Forward to 2013 again
Ok, we know now they were able to secure a lot money because they were able to show how profitable the idea already was.
But that alone doesn’t solve the problem. You still need to find users. What so much money allows you though is to buy time to play with different strategies until you find the one that works for you.
In the TechCrunch Article mentioned above, we also read: “The Canva LinkedIn description goes into more detail as to what that might mean in terms of actual use cases, saying it could be used to “design your Facebook cover photo, new business cards, a presentation, menu for your cafe, brochure for your client’s business…”
These seemed to be their initial specific use-cases.
Let’s now try to guess what they tried. Let me paste this again.
One other thing to notice in the left menu is “Bloggers” and that takes us here:
Ok. So partnership and micro-influencers.
I googled and there are indeed some blog posts about Canva for the following year. Many of them show how easy it is to create a Facebook cover, for example. Probably back then approaching bloggers was a favorite channel. Think of BuzzSumo last week (here if you missed it), they did have an amazing value proposition for bloggers in the marketing area which is also why it worked so well for them.
One other assumption I could make at this point is that because Facebook was one of their use-cases, they probably invested in Facebook ads. I can't prove it but I wouldn’t see why not.
So what’s next?
End of 2013 they are still in the waiting list phase.
I googled and there are indeed some blog posts about Canva for the following year. Many of them show how easy it is to create a Facebook cover, for example. Probably back then approaching bloggers was a favorite channel. Think of BuzzSumo last week (here if you missed it), they did have an amazing value proposition for bloggers in the marketing area which is also why it worked so well for them.
One other assumption I could make at this point is that because Facebook was one of their use-cases, they probably invested in Facebook ads. I can't prove it but I wouldn’t see why not.
So what’s next?
End of 2013 they are still in the waiting list phase.
But now they also call for Designers, Photographers, and illustrators. Which makes so much sense. Photographers and Illustrators are not specifically invited to use Canva but to submit their work so that Canva users can use it in their design.
They are sort of building their “marketplace” if you allow me.
And they have a blog. Which is up and running for some time now. It’s easy to assume that they were trying to get visits from the blog as well.
Another assumption that naturally come to my mind is investing in Google ads. As far as I know they still heavily invest in it to this day. So why not back then.
Beginning of February Canva is for everyone to access, the waiting is over. During 2014 they also release their Chrome app and in October 2014 they release their mobile app in the Apple store.
From my research, it seems that the launch of the app allowed them to sort of relaunch the tool and to position it as the tool that makes being creative on the iPad something possible and easy.
"Our app will help Canva reach new markets, as people can design wherever they are, whether they are at the office, at home or on the go," Melanie says.
That is quite a positioning. The first iPad was released in 2010. The years after are the years of the crazy run to buy it and use it. By positioning themselves as the only app that allows to be creative on the go, they are basically securing the whole market of people wanting to use their iPad for more. Which turned out to be a fast growing market.
From here there is a lot more talking about the tool on the internet and they keep raising money which of course allows them to expand and do many more campaigns.
Assumptions 3: They used the chance of launching the app to stir the water, create noise and position themselves in a new light.
It is difficult to reconstruct what happens from here. It’s also difficult to assume specifically what campaigns they ran to attract new users but there is a lot more talking on the internet so we can assume the tool had taken off.
WHAT CAN WE LEARN FROM THIS STORY
So let’s recap what we learned from the first years of the life of Canva. If you are thinking that 3 million dollars make life easier, I agree but I still believe there is so much more to that.
Here what I think:
1. Don’t be afraid of niching down, you can extend your market later.
2. Going small allows you to test the viability of your solution and find if users are willing to pay. If they do, that gives you proof that your idea works. It will make it easier to raise money if you ever need to.
3. Creating a solution to a problem as an insider gives you an advantage.
4. If you don’t already have an audience, social media shouldn’t be your preferred channel.
5. Partnership works but only if you choose the right partners.
6. Planning a relaunch with a stronger positioning can bring you more visibility and customers.
Archeology of 0 to 1 is a special column of TILT where I regularly research the early history of famous products trying to summarise repeatable learnings.
They are sort of building their “marketplace” if you allow me.
And they have a blog. Which is up and running for some time now. It’s easy to assume that they were trying to get visits from the blog as well.
Another assumption that naturally come to my mind is investing in Google ads. As far as I know they still heavily invest in it to this day. So why not back then.
Beginning of February Canva is for everyone to access, the waiting is over. During 2014 they also release their Chrome app and in October 2014 they release their mobile app in the Apple store.
From my research, it seems that the launch of the app allowed them to sort of relaunch the tool and to position it as the tool that makes being creative on the iPad something possible and easy.
"Our app will help Canva reach new markets, as people can design wherever they are, whether they are at the office, at home or on the go," Melanie says.
That is quite a positioning. The first iPad was released in 2010. The years after are the years of the crazy run to buy it and use it. By positioning themselves as the only app that allows to be creative on the go, they are basically securing the whole market of people wanting to use their iPad for more. Which turned out to be a fast growing market.
From here there is a lot more talking about the tool on the internet and they keep raising money which of course allows them to expand and do many more campaigns.
Assumptions 3: They used the chance of launching the app to stir the water, create noise and position themselves in a new light.
It is difficult to reconstruct what happens from here. It’s also difficult to assume specifically what campaigns they ran to attract new users but there is a lot more talking on the internet so we can assume the tool had taken off.
WHAT CAN WE LEARN FROM THIS STORY
So let’s recap what we learned from the first years of the life of Canva. If you are thinking that 3 million dollars make life easier, I agree but I still believe there is so much more to that.
Here what I think:
1. Don’t be afraid of niching down, you can extend your market later.
2. Going small allows you to test the viability of your solution and find if users are willing to pay. If they do, that gives you proof that your idea works. It will make it easier to raise money if you ever need to.
3. Creating a solution to a problem as an insider gives you an advantage.
4. If you don’t already have an audience, social media shouldn’t be your preferred channel.
5. Partnership works but only if you choose the right partners.
6. Planning a relaunch with a stronger positioning can bring you more visibility and customers.
Archeology of 0 to 1 is a special column of TILT where I regularly research the early history of famous products trying to summarise repeatable learnings.
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