Swedish buy-now-pay-later firm Klarna has closed a $1bn private fundraising round, bringing the company to a $31bn valuation and tripling what it was worth six months ago. 

The new round follows a $650m round in September last year, led by Silver Lake, that valued Klarna at $11bn.

The round makes Klarna Europe’s most valuable startup and the second most valuable fintech worldwide.

Backers in the latest round are said to be a mixture of new and existing investors. Early investors in the company include AB Orestund and Sequoia Capital and Atomico. More recently, Northzone, Bestseller Group, Permira, Visa, Dragoneer and the Commonwealth Bank of Australia have backed the firm.

Klarna is among several European tech companies widely rumoured to be lining up an IPO. 

Some had been expecting the company to do so through a merger with a special purpose acquisition company (SPAC) — a vehicle created to bring private companies to market. However, this was ruled out by Sebastian Siemiatkowski, Klarna’s cofounder and CEO, last week. Siemiatkowski confirmed the company was considering a direct listing instead.

Klarna, founded in 2005, was one of the earliest companies in the now booming buy-now-pay-later sector. The company reported revenue increases of 40%, to $1bn, across 2020. However, losses also accelerated 50% due to expansion costs, with the company’s net loss coming in at around $109m last year.

Klarna’s now active in 17 countries and has over 250k retail partners, including Macys, Etsy, Sephora, Ralph Lauren and Urban Outfitters. 

Alongside the latest fundraise, Klarna announced that it will give 1% of capital raised to focus on sustainability challenges around the world. The initiative will go live on April 22nd, World Earth Day. 

“I believe our industry has a responsibility to help in some way solve global sustainability issues and I hope others will join Klarna in our ambition,” said Siemiatkowski.

Freya Pratty is Sifted’s news reporter. She tweets from @FPratty