Canva Acquires Cavalry and MangoAI, Narrowing its Gap with Adobe

Canva has acquired Cavalry and MangoAI, positioning itself as a formidable competitor to Adobe, after reporting $4 billion in annualised revenue, 265 million users, and nine consecutive years of positive free cash flow. This performance stands in stark contrast to Adobe, which generated $6.2 billion in the last quarter alone but saw its growth slow to just 10% and its stock price decline by 30% over the year. The narrowing gap between the two companies highlights Canva’s rapid ascent in the creative software space.

More About the Acquisition of Cavalry

Cavalry is a small, four-person studio based in the UK that develops specialised 2D animation software. The tool has quietly gained a following among professional designers as a more agile and affordable alternative to Adobe After Effects, with major tech companies such as Amazon, Google, Meta, and Netflix counting teams that utilise it.

Canva’s strategy for Cavalry involves a dual approach: it will continue to sell the software as a standalone product while also integrating its technology into Canva’s main platform and Affinity. Affinity is the professional design suite that Canva acquired in 2024, which was subsequently made free in October and has since surpassed 5 million downloads. This move reinforces Canva’s commitment to bolstering its professional-grade offerings.

More About the Acquisition of MangoAI

The second acquisition, MangoAI, is an early-stage U.S. startup focused on optimising video advertisements through reinforcement learning. Its technology analyses ad performance across different platforms and uses those insights to automatically refine video content, such as splicing a strong call-to-action from one campaign onto a compelling hook from another. This capability will be integrated into Canva Grow, the company’s marketing tool available on its business tier for $250 per person annually.

These purchases mark Canva’s fifth and sixth acquisitions in just two years, following the buys of Affinity, Leonardo AI, and MagicBrief. This pattern reveals a clear strategy: Canva is methodically filling gaps across the professional creative workflow, acquiring specialized tools to build a comprehensive suite. By doing so while maintaining a low-cost model, Canva is effectively making Adobe’s pricing seem expensive in comparison.

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Canva’s Philosophy According to its Co-founder

Co-founder Cameron Adams provided insight into the company’s philosophy regarding artificial intelligence. He noted that while generative AI is highly effective at getting a project most of the way to completion, it struggles with the final, critical stages of refinement. This last stretch involves ensuring content aligns with brand identity, resonates with a specific audience, and achieves tangible performance goals.

This identified gap between raw AI generation and polished, performance-ready content is precisely the space Canva aims to dominate. The acquisitions of Cavalry and MangoAI, which specialise in precise animation work and data-driven ad optimisation, are therefore logical steps. They represent Canva’s push to own the finishing touches of the creative process, moving beyond simple design to encompass the performance-driven end of the market.