Canva Lays Off 1,271 People, 22 Percent of Its Staff: Employees Pay for the First Slowdown in Ten Years While AI Costs Keep Climbing

Canva, the design platform hundreds of millions of people use to make posters, presentations and posts, is laying off 1,271 people, or 22 percent of its staff. The company itself gave the reason: growth has slowed for the first time in ten years.

Co-founder and chief executive Melanie Perkins sent employees a letter that sounds like every letter of its kind. "Over the past thirteen years, we went from a dream in an investor pitch deck to a platform used by hundreds of millions of people," she writes, only to add straight away that "success in the first chapter doesn't guarantee success in the next" and that this is "the hardest year yet".

What changes, apart from the headcount? The product, growth and platform teams are merging into one, to reduce friction in communication. The company is also abandoning narrow specialisation, which in human language means those who stay will get more tasks. Remote work is being cut back - it moves to a hybrid model, with several days a week in the office.

The background is more interesting than the letter. Canva is developing its own AI models to cut costs and reduce dependence on other companies' models, but AI costs have grown so much that the company had to lower its revenue growth forecast from 30 to 20 percent. Early investors had already cut the company's estimated value earlier this year to about 35 billion dollars (about 31 billion euros).

And the competition isn't only coming from other startups. ChatGPT and Gemini now put together a poster or a presentation from a single sentence. The irony is hard to miss: the company that gave everyone a tool to design without a designer is now watching chatbots do it without Canva. How many other companies that grew on the promise of "easy for everyone" will be next?