Klarna’s Valuation Triples In Six Months To $31 Billion, Minting Two New Fintech Billionaires

Buy now, pay later fintech company Klarna, which lets people pay in installments for everything from Macy’s M suits to Etsy knick-knacks, has raised $1 billion in new funding at a $31 billion valuation. That’s nearly triple its value from just six months ago, when the Stockholm-based business hit $11 billion. It’s yet another sign of the red-hot, frothy fintech market, where valuations have risen to astronomical levels while online shopping has soared over the past year.

Cofounder and CEO Sebastian Siemiatkowski owns nearly 8% of Klarna and is now worth $2.2 billion (Forbes applies a 10% discount to private company valuations). Victor Jacobsson, another cofounder who left the company in 2012, has a roughly 10% stake and is worth $2.7 billion. Third cofounder Niklas Adalberth owns just 0.4% of Klarna after selling some shares to fund his philanthropic organization and investing in startups, making his Klarna shares worth about $100 million.

Klarna was founded in 2005 and pioneered the buy now, pay later model in fintech, which has surged in popularity since the pandemic began.

In 2020, Klarna processed $53 billion in global transactions and grew revenue 37% to reach $1.2 billion. It’s available in 17 countries but not profitable, losing $163 million last year. Australian-based competitor Afterpay processed $11 billion in retail purchases last year, while San Francisco fintech Affirm did about $6 billion. 

In the U.S., Klarna has nearly four million “monthly active” users, or customers who logged in over the past month. It says it works with 20 of the top 100 American retailers, and it’s now taking on QVC QVCA with a push into livestream retailing.