That stake hasn’t been diluted by Canva, valued at $US25.6 billion ($39.8 billion), issuing new shares since. That suggests Blackbird’s position in Canva, which it has partially cashed out, is worth about $6 billion.
Presuming 20 per cent carry, Blackbird’s partners would be in line for up to $1.2 billion. They’re now numerous, but at the start when Blackbird made some of its best Canva bets they numbered just three: Niki Scevak, Rick Baker and Bill Bartee, who has since departed to Main Sequence.
Take Blackbird’s first fund, which started with $29 million in capital and made a major early investment in Canva. That stake ballooned in value to about $1 billion before Blackbird started selling it off.
Given that fund is past its planned closure date, it likely accounted for much of the $1 billion-plus in Canva stock Blackbird has sold in recent months. That could be up to $200 million heading towards Blackbird’s three founding minds from those sales alone.
(Main Sequence, which invests in the “deep technology” field of science-based companies that are even riskier than most start-ups, is yet to return a cent.)
There’s rather a lot of caveats on the Canva carry, though. Canva stock sales have to make up for any losses among other companies in whichever Blackbird fund, and repay investors’ initial contribution, before they start contributing to carry. But then, Canva isn’t Blackbird’s only winner. The fund won’t say exactly who benefits from the carry or if it charges industry standard rates.
Industry figures reckon it’s common for venture funds to offer cheaper rates when they’re getting started and to woo superannuation funds. Plus Blackbird has various costs, and it has added partners in the years since its first investments, so Bartee, Baker and Scevak won’t be reaping all the rewards.
More conservatively, then, based on the $5.1 billion in distributions and investment performance Blackbird discloses publicly, and 15 per cent carry, the fund has earned about $750 million of carry. Either way, many of Blackbird’s partners are deep in yacht money.
There’s another thing: they deserve the money. AirTree and Square Peg are always mentioned in the same breath as Blackbird for investing in Canva, but their stakes are comparatively minor.
Square Peg hasn’t invested in the company since 2015. Blackbird made the bet early, then went in hard again and again. It’s right that Blackbird’s partners are enjoying the spoils, though whether they wish they sold when Canva was worth almost twice as much in 2021 is an open question.
