Klarna Notches $460M In Equity Funding
To further support massive U.S. growth, Klarna has notched $460 million in an equity funding round at a $5.5 billion post-money valuation. This new valuation ranks Klarna as the biggest European private FinTech and one of the largest private FinTechs around the world, according to an announcement from the company.
Klarna CEO and Co-founder Sebastian Siemiatkowski said in the announcement, “This is a decisive time in the history of retail banking. Finally, transparency, technology and creativity will serve the consumer, and there will be no more room for unimaginative products, non-transparent terms of use or lack of genuine care of one’s customers. We, all 2,500 of us at Klarna, are humbled and honored, and now also further empowered, to play a role in this improvement of an industry for the benefit of the consumer, worldwide and in the U.S. in particular.”
The funding will help Klarna continue its rapid rise in the United States market, where it is currently growing at an annual rate of six million new consumers. The company said that “the uniqueness of Klarna’s consumer offering, providing a healthier, simpler and smarter alternative to credit cards, with the addition of multiple services to smoothen the shopping experience, online and offline, is clearly resonating with the U.S. consumer.”
It also pointed out that the company’s newly rolled out shopping app “has been received very positively,” with over 50 percent of the app users purchasing each week.
The funding round was led by San Francisco-based growth-oriented investor Dragoneer Investment Group. Other investors in the round include Commonwealth Bank of Australia, Merian Chrysalis Investment Company Limited, Första AP-Fonden (AP1), HMI Capital LLC, IPGL, IVP and funds and accounts managed by BlackRock. This investment comes after a funding round in April that closed above the company’s $100 million target, driven by strong demand from its existing investor base.
Dragoneer Founding Partner Marc Stad said in the announcement, “Our strategy is to partner with a small number of disruptive growth companies that are highly differentiated and run by world-class management teams. Sebastian and the Klarna team have built an exceptional payments business with a global footprint, operating in a huge addressable market with strong tailwinds.”