Canva Acquires Leonardo.ai to Enhance Generative AI Capabilities

Canva has acquired Leonardo.ai, a generative AI content and research startup, to expand its AI technology offerings. The financial terms of the deal were not disclosed, but it includes a mix of cash and stock. Leonardo.ai’s entire team of 120 employees, including the executive team, will join Canva.

Continuing Innovation

Leonardo.ai will continue to operate independently, focusing on innovation and development, supported by Canva's resources. “We’ll keep offering all of Leonardo’s existing tools and solutions,” said Cameron Adams, Canva’s co-founder and chief product officer. “This acquisition aims to help Leonardo develop its platform and deepen their user growth with our investment, including by expanding their API business and investing in foundational model R&D.”

Origins and Evolution

Founded in 2022 and based in Sydney, Leonardo.ai initially focused on creating assets for video games. However, the team soon expanded its platform to cater to industries like fashion, advertising, and architecture, offering tools for AI model creation and image generation.

Today, Leonardo.ai provides collaboration tools and a private cloud for models, including video generators and APIs that allow customers to build their own tech infrastructure. The platform stands out by offering users a high degree of control, such as the Live Canvas feature, which combines text prompts with quick sketches to create photorealistic images in real-time.

According to co-founders Jachin Bhasme, J.J. Fiasson, and Chris Gillis in a December interview with TechCrunch, Leonardo.ai stands out from other generative AI art platforms by offering users a high level of control. For instance, its Live Canvas feature allows users to input a text prompt and create a quick sketch of their desired outcome. As the user sketches, Leonardo.ai generates a photorealistic image in real-time, combining both the text and sketch prompts.

The platform stands out by offering users a high degree of control, such as the Live Canvas feature, which combines text prompts with quick sketches to create photorealistic images in real-time.

Training Models and User Support

Leonardo.ai’s training methods for its generative models, like the flagship model Phoenix, remain somewhat unclear. The company states that it uses “licensed, synthetic, and publicly available/open source data” for training.

Canva has committed $200 million over the next several years to compensate creators who consent to having their content used for training AI models. Leonardo.ai has over 19 million registered users, and its tools have been used to create more than a billion images.

Integration with Canva

Leonardo.ai will contribute to Canva’s Magic Studio generative AI suite. The startup had previously raised over $38.8 million from investors including Smash Capital, Blackbird, Side Stage Ventures, TIRTA Ventures, Gaorong Capital, and Samsung Next.

“We’ll look to integrate Leonardo’s technology into Magic Studio,” Adams said. “This might include making existing Magic Studio tools more powerful, or introducing new generative AI capabilities powered by Leonardo’s models directly in Canva. It’s early days, and we’ll be coming together right away to determine how this looks, but we’re excited to expand what our users are able to do with AI on Canva."

Canva’s Generative AI Journey

Since December 2022, Canva has been investing in generative AI tools, starting with the copywriting assistant Magic Write. The company has accelerated its development efforts through both internal projects and acquisitions. In February 2021, Canva acquired Kaleido, which laid the foundation for much of its recent AI advancements.

Leonardo.ai marks Canva’s eighth acquisition and the second this year, following the purchase of U.K. design company Affinity for an estimated $380 million. Canva also owns presentations startup Zeetings, stock photography sites Pixabay and Pexels, and product mockup app Smartmockups.

Founded in 2012, Canva has raised over $560 million and boasts a valuation of $26 billion, generating close to $2 billion in revenue with over 180 million monthly users worldwide.

“It’s a significant but natural next step in our efforts to build the most powerful, all-in-one visual AI offering,” Adams said. “Pairing Canva’s workflow with new generative capabilities will help us continue to set our AI offering apart and deliver new possibilities for the growing base of teams and enterprises using Canva.”