\Fintech News/ Klarna becomes Europe’s most valuable fintech after raising at $11bn valuation Klarna has raised $650m with a post-money valuation of $10.65bn, making the Swedish company by far the most valuable fintech in Europe. By Mimi Billing 15 September 2020 \Fintech The 10 fastest fintechs to reach billion dollar valuations By Isabel Woodford 11 January 2021 \Fintech News/ Klarna becomes Europe’s most valuable fintech after raising at $11bn valuation Klarna has raised $650m with a post-money valuation of $10.65bn, making the Swedish company by far the most valuable fintech in Europe. By Mimi Billing 15 September 2020 Swedish startup Klarna has raised a fresh funding round of $650m at a post-money valuation of $10.65bn, making it by far the most valuable fintech in Europe. The buy-now-pay-later company, which is making a big push into the US market ahead of a probable IPO, was last valued a $5.5bn in August 2019. The company has benefited from the increase in online shopping during the pandemic, and investors are betting that this is an accelerating trend. Advertisement Sebastian Siemiatkowski, cofounder and chief executive of Klarna, said: “We are at a true inflection point in both retail and finance. The shift to online retail is now truly supercharged and there is a very tangible change in the behaviour of consumers.” The company allows shoppers to pay for products bought online later in the month or in instalments, effectively giving them an interest-free loan. For taking on this credit risk, Klarna charges retailers such as Asos or H&M each time it is used. Retailers like the service because they think it encourages shoppers to buy online. Silver Lake, the US private equity group, put in $500m of the fresh money in a further sign of how American buyout companies are ferociously snapping up growth assets. Silver Lake has been particularly active throughout the pandemic taking stakes in Airbnb, Twitter, Expedia and Reliance Retail. Singapore’s sovereign wealth fund GIC, BlackRock and HMI Capital also put in money. Others, like Merian Chrysalis, TCV, Northzone and Swedish media house Bonnier have taken the opportunity to acquire shares from existing shareholders. Egon Durban, Silver Lake’s co-chief executive, said: “Klarna is one of the most disruptive and promising fintech companies in the world, redefining the ecommerce experience for millions of consumers and global retailers, just as ecommerce growth is accelerating worldwide and rapidly shifting to mobile.” According to Klarna, the new investment will help the company grow its global presence with a focus on the US where the company is growing particularly rapidly and now has more than 9m consumers. Klarna is rare among European fintechs in that it has pretty much always been profitable since it was founded in 2005, with the exception of 2019 when it made a $93m loss. This was mainly due to challenges in the American market. Despite originally seeing slow growth in the US, Klarna told Sifted in August 2019 that it was on the cusp of tapping into a monumental trend. “There has been a massive amount of demographic shifts in the UK and in the US the last ten years that we were unaware of. Although credit card volume has grown about twice, debit card volume has grown tenfold and 70% of millennials in the US do not have a credit card, they only have a debit card,” Siemiatkowski told Sifted then. The funding round of $650m will surely put Klarna one step closer to an IPO, which the company has said is most likely to happen in the US. Other valuable European fintech companies include the London-based neobank Revolut, which was worth $5.5bn at the last fundraise, and German challenger bank N26, which is worth $3.5bn. Mimi Billing is Sifted’s Nordic correspondent. She also covers healthtech, and tweets from @MimiBilling Advertisement Help Sifted get bigger and better (and get a sneak peak at our future plans). Please take our reader survey. Take the survey Terms of Use Related Articles Starling Bank wants to buy a lender By Ryan Weeks Click here to read more Checkout.com becomes Europe’s largest unicorn with $15bn valuation By Isabel Woodford Click here to read more The 10 fastest fintechs to reach billion dollar valuations By Isabel Woodford Click here to read more The European startups making a mint from the bitcoin boom By Sifted reporters Click here to read more Get the best of Sifted in your inbox By entering your email you agree to Sifted’s Terms of Use Sign up to \Future Proof Sifted’s weekly \Corporate Innovation roundup email By entering your email you agree to Sifted’s Terms of Use Most Read 1 \Fintech Starling Bank wants to buy a lender 2 \Startup Life Chief of staff: the ‘must-have hire’ for startup CEOs? 3 \Fintech The 10 fastest fintechs to reach billion dollar valuations 4 \Venture Capital Rich Europeans need to invest 10% of their money into tech and stop buying stupid stuff like hotels 5 \Public and Academic European Commission makes its first equity investments into startups 2 Join the conversation Subscribe newest oldest most voted Notify of new follow-up comments new replies to my comments Miran KThe valuation was expected as the idea of interest-free loans are effective for consumers. However, what is worrying is the rapid and astronomical growth of young adults being put into debt at young ages (especially in Sweden) since the financial hegemony of Klarna was informally established. BayanCouldn’t agree more. The company not acting responsibly and in a good faith.
Checkout.com becomes Europe’s largest unicorn with $15bn valuation By Isabel Woodford Click here to read more
The 10 fastest fintechs to reach billion dollar valuations By Isabel Woodford Click here to read more
The European startups making a mint from the bitcoin boom By Sifted reporters Click here to read more