Sweden’s Klarna, once Europe’s most valuable private fintech company, has had its valuation slashed to $6.7bn in the clearest sign of the struggles facing the sector.
The new valuation, a fraction of the $46bn it was valued at last June, was announced as the company closed an $800mn funding round. The round featured new investors including Mubadala, the sovereign wealth fund of the United Arab Emirates, and the Canada Pension Plan Investment Board.
Sebastian Siemiatkowski, Klara’s chief executive, said: “It’s a testament to the strength of Klarna’s business that, during the steepest drop in global stock markets in over 50 years, investors recognised 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.”
Klarna has been a pioneer of buy now, pay later, a form of short-term credit that was helped by the ecommerce boom of the coronavirus pandemic but which has struggled in the face of inflationary pressures and falling consumer spending.
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