Canva cuts 1,271 jobs in first restructuring since 2013

Why Canva is restructuring

Canva’s restructuring follows its first growth slowdown in a decade, with revenue growth projections for 2026 cut from 30% to 20%. The company attributes the slowdown to higher-than-expected costs of integrating AI features into its platform, as well as a need to simplify its business operations. CEO Melanie Perkins described the changes as the "hardest moment" in Canva’s 13-year history, emphasizing the need to return to smaller, more autonomous teams.

The company is consolidating its product, growth, and platform teams into a single product organization to reduce handoffs and improve accountability. Management layers are being reduced, and Sydney will become the primary hub for most product teams, with some employees asked to relocate. Hybrid workers will be required to spend two to three days in the office starting in January.

Valuation and market pressures

Canva’s valuation has reportedly declined from $40 billion in 2021 to roughly $26 billion over the past year. Investors like Blackbird Ventures and Airtree have downgraded their valuations amid concerns about AI’s impact on Canva’s business model and the rising cost of AI integration. The company’s internal valuation was also cut due to soaring expenses related to AI product rollouts.

The restructuring reflects broader trends in the tech industry, where companies like Atlassian, WiseTech Global, and Squarespace have also conducted significant layoffs or workforce reductions to fund AI investments or streamline operations.

Severance and support for departing employees

Affected employees will receive at least six months’ salary, including statutory entitlements, along with extended healthcare benefits and access to Canva’s employee assistance program, Canva Care, for a year. Departing staff can retain their company-issued MacBooks and will receive career transition support, including LinkedIn Premium, career coaching, and interview preparation.

Canva is also launching the Canva Collective Fund, offering US$10,000 grants to employees who want to start their own ventures. The company will not take equity or ownership in these ventures, and applications for the fund close on 14 December.

What this means

Lazyfounder analysis — our interpretation, not reported fact.

Canva’s restructuring sends a clear signal to founders and operators about the pressures facing even well-established startups in the AI era. The company’s decision to consolidate teams, tighten hybrid work policies, and simplify management layers suggests a shift toward leaner, more centralized operations—mirroring moves by other tech firms adapting to higher AI integration costs and slower growth.

For startups, Canva’s experience underscores the importance of agility in organizational design. The layoffs, while drastic, are positioned as a strategic reset to prioritize autonomy and accountability, particularly as AI tools reshape workflows and reduce reliance on specialized roles. The severance package, including grants for departing employees to launch ventures, also highlights a growing trend: companies are recognizing the need to support career transitions, not just as a moral imperative but as a way to maintain goodwill and preserve talent pipelines.

Investors and founders should take note of Canva’s valuation cuts, which reflect broader market skepticism about the sustainability of AI-driven growth. While AI remains a key focus for tech companies, the financial realities of scaling these technologies—such as rising costs and integration challenges—are forcing even unicorns to reconsider their strategies.

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