Talk about buyer's remorse. But really, this just goes to show how tricky it is to value private companies.
๐ Background: Canva is the Aussie unicorn known for making graphic design super easy. It blew up faster than Jack Harlow's Glamorous remix... and hit a $55 billion valuation last year.
๐ What happened: One of Canva's big time investors, Franklin Templeton, cut its investment in the company by just over a third. And, they reckon the company is actually valued at something like $37 billion.
๐ What else: Other investors are staying strong on Canva's valuation...but it just goes to show that private companies are a lot trickier to value than public ones.
๐ก Valuing private companies is often a lot more complex - and often less transparent - than valuing public companies.
๐ก For public companies, valuation is generally determined by market capitalisation. That's the current share price multiplied by the total number of shares - simple! But there's no quick maths for valuing private companies.
๐ก Some companies pitch their valuation on revenue...while others base it on a multiple of EBITDA. Ultimately, it's up to private investors to determine the price when the company raises money. But Franklin T's withdrawal doesn't put Canva in the best light for future investors.
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