BNPL fintech Klarna has announced the closing of a $800M investment fund that has elevated its valuation to $6.7bn.
With an eye on expanding the company further into the US, Klarna’s newest investment fund raises its valuation after cutting 10% of its workforce due to investors halting on the BNPL platform, accounting for a significant drop in its valuation which at its peak was $45.6bn last year.
Klarna CEO, Sebastian Siemiatkowski, commented: “It’s a testament to the strength of Klarna’s business that, during the steepest drop in global stock markets in over fifty years, investors recognized our strong position and continued progress in revolutionising the retail banking industry.
“Now more than ever businesses need a strong consumer base, a superior product, and a sustainable business model.”
Despite its challenges, Klarna received strong backing from its existing investors including Sequoia, Bestseller, Silver Lake, and the Commonwealth Bank of Australia.
More notably, several entities known for their long-term commitments made their first investments in Klarna, these include Mubadala Investment Company and the Canada Pension Plan Investment Board (CPP Investments).
“The shift in Klarna’s valuation is entirely due to investors suddenly voting in the opposite manner to the way they voted for the past few years,” added Michael Moritz, Partner at Sequoia.
“The irony is that Klarna’s business, its position in various markets and its popularity with consumers and merchants are all stronger than at any time since Sequoia first invested in 2010. Eventually, after investors emerge from their bunkers, the stocks of Klarna and other first-rate companies will receive the attention they deserve.”