GIC-backed Klarna's valuation hits $61b after fund raising

STOCKHOLM • Swedish payments firm Klarna has raised US$639 million (S$846 million) from a group of investors led by SoftBank's Vision Fund II, lifting its valuation to about US$46 billion (S$61 billion) - higher than several of the region's major banks.

Klarna, which allows shoppers to buy online through its merchant partners and settle dues in instalments via "buy now, pay later" (BNPL), became Europe's most valuable start-up in March when a US$1 billion fund-raising valued it at US$31 billion.

This round was led by SoftBank, joined by existing investors such as Adit Ventures, Honeycomb Asset Management and WestCap Group. Klarna's other investors include Commonwealth Bank of Australia, Ant Group, rapper Snoop Dogg, BlackRock and Singapore's sovereign wealth fund GIC.

Reuters reported last month that Klarna was close to raising a new round of funding at a valuation close to US$50 billion.

The company, whose chief executive is Swedish-born Sebastian Siemiatkowski, is among the largest players in the global BNPL sector, with more than 90 million global active users. It processes two million transactions a day.

The company is expected to make a stock market debut either later this year or next year. Mr Siemiatkowski said earlier that he prefers direct listing to take the company public.

"We are happy shareholders and we could sell our shares tomorrow if we wish, so we don't have any stress to take the company public," said Mr Hans Otterling, a partner at venture capital firm Northzone, an early investor in Klarna.

Klarna, founded in 2005, took eight years to reach a valuation of US$1 billion, but less than 12 months to go from being valued at US$5.5 billion to within touching distance of US$50 billion.

It has seen a surge in demand as the coronavirus pandemic drives a shift in consumer spending online.

REUTERS

A version of this article appeared in the print edition of The Straits Times on June 12, 2021, with the headline 'GIC-backed Klarna's valuation hits $61b after fund raising'. Subscribe