Canva Acquires Leonardo AI to Enhance Generative Image Solutions

Today, creative design platform Canva announced its acquisition of Leonardo AI, an Australian startup known for its advanced generative AI platform that creates images and art using open-source Stable Diffusion models.

While the financial details of the deal were not disclosed, Canva confirmed that Leonardo's team of 120 members, including AI researchers and executives, will join Canva's AI division. They will work on integrating Leonardo’s proprietary technology and the new “Phoenix” foundation model into Canva’s suite of AI products.

“This field is constantly evolving, and we cannot overstate the impact of Leonardo’s technical leadership and community engagement. Uniting our teams will accelerate our efforts, enhancing both our strengths as we move forward,” said Cameron Adams, Canva's co-founder and Chief Product Officer.

Leonardo’s Evolution

Founded in 2022, Leonardo initially aimed to optimize the production of video game assets, responding to high production costs and lengthy development cycles. However, the founders—Jachin Bhasme, J.J. Fiasson, and Chris Gillis—quickly recognized the broader potential of their technology, expanding into advertising, marketing, product design, fashion, and education. They also introduced features offering users fine-grained control, such as character referencing and a real-time canvas for creative direction.

Success in the Creative AI Space

In just two years, Leonardo has made significant strides in the competitive creative AI landscape, which includes established players like Midjourney and Adobe, attracting 19 million users who have collectively generated over a billion images. Last month, the company launched Phoenix, its first in-house foundation model, boasting enhanced prompt adherence.

With today's acquisition, Leonardo aims to leverage Canva’s resources—financial support, human expertise, and licensed content—to boost its research and development and expand its independent platform capabilities. Canva assures that no user content will be shared with Leonardo unless users explicitly opt-in.

Leveraging Canva's Scale

Beyond enhancing features and models, Leonardo plans to utilize Canva’s extensive reach. Its technology, including the Phoenix model, will soon be integrated into Canva’s Magic Studio, granting over 190 million users access to innovative tools.

For Canva, incorporating Leonardo’s technology will improve its offerings, allowing creators to enhance both the creative and strategic dimensions of their work with faster, more compelling visual content. However, the specifics of how these capabilities will be rolled out to users have yet to be disclosed.

Canva's AI Journey

Canva has been steadily enhancing its AI capabilities to compete with emerging creative platforms such as Midjourney, Stability AI, and industry leader Adobe. The company began its AI journey in 2019 with background removal tools, followed by the launch of its Text to Image tool in 2022. This push culminated in the introduction of a suite of AI tools called Magic Studio, which has been used over seven billion times. Canva has also acquired several companies, including Affinity, Kaleido, and Pixabay.

Despite some skepticism about the acquisition, particularly from Ed Newton-Rex, CEO of AI certification startup Fairly Trained, who questioned Canva's data practices, the integration of Leonardo is poised to enhance Canva's web-based creative suite, improving its competitiveness against Adobe's Creative Cloud.