Klarna’s Valuation Plummets In New Fundraise

Buy now, pay later giant Klarna has raised $800 million in a new round of funding that values the company at $6.7 billion, Reuters reported.

The new valuation is a significant drop from its last. The company was valued at around $46 billion last year, meaning its valuation has fallen around 85%.

Search less. Close more.

Grow your revenue with all-in-one prospecting solutions powered by the leader in private-company data.

Start Your Search

Klarna was the sixth-highest valued unicorn in the world at its previous valuation, according to the The Crunchbase Unicorn Board. It’s backed by investors including the SoftBank Vision Fund and Arctic Ventures.

Buy now, pay later companies were once hot investments, and the past couple of years have seen Affirm go public, Square acquire Afterpay for $29 billion, and Klarna’s private valuation soar. The company also benefited from a pandemic-induced uptick in online shopping, with many customers opting to pay for their purchases in installments.

But both private and public market investors seem to have soured on BNPL companies in recent months. The stock price of a publicly traded BNPL company, Affirm, for example, is down more than 77 percent so far this year.

The market downturn seems to have affected late-stage companies the hardest, and Klarna is no exception. The Stockholm-based company initiated layoffs earlier this year. Reports followed that it was seeking new funding at a significantly lower valuation. It’s quite the opposite of last year. The company saw its valuation balloon to $46 billion, minting it as Europe’s most valuable unicorn, according to the Crunchbase Unicorn Board.

Klarna, founded in 2005, last raised money with a $639 million funding round led by the SoftBank Vision Fund in June 2021.