Airtree's Canva feud
Airtree's earliest backers have revolted over a plan to extend its 12-year-old fund in the hope Canva throws them a bone. Again.
It was a simpler time when AirTree Ventures founders Craig Blair and Daniel Petre raised their first $60 million fund in 2014. The world was bizarrely rapt over Ellen DeGeneres' Oscar selfie. The Ice Bucket Challenge was considered a logical way to somehow cure motor neurone disease. [[The Ice Bucket Challenge raised $220 million globally in 2014 from 17 million videos, according to data from the AlS Association, which is incidentally one-third the size of Airtree's latest fund.]] Canva, now Australia's largest private technology company, was just one year old and had raised a $US3 million seed round.[[Back then, the greenback and the Aussie dollar were virtually at parity.]]And those who decided to back Australia's venture capital industry were still under the impression their funds would be wound down a decade later.
How things have changed. Ellen is a distant memory, retired in the Cotswolds. Blair and Petre fell out long ago, with the latter no longer involved in the day-to-day management of Airtree (the firm has even decapitalised his half of the firm's name, for the avoidance of any doubt).[[ Petre's official title is now Partner Emeritus.]] Canva's now valued at $US35 billion ($49 billion). And last week, Airtree approached its investors about extending its now 12-year-old Fund 1 in the hope Canva may go public or present an exit opportunity before July 2028. It did not go well.
Blair held a meeting for limited partners on Tuesday where he said they should support yet another fund extension and, according to those present, blamed Canva's "stranglehold" on the cap table as the reason Airtree has been unable to generate meaningful returns in the now multi-billion dollar design software giant over the past two years. This is despite other investors, including Blackbird Ventures, selling shares at Canva's record $US42 billion valuation during this period. Blair said Airtree would ideally extend the fund by 20 months but would settle for 12 months, to July 2028, and urged the limited partners to approve it.
Immediately after the meeting concluded, Petre fired off an angry email to Airtree chief executive Elicia McDonald and the fund's external advisers to complain about the firm's poor communication and, more broadly, its mishandling (as he sees it) of the Canva investment.
