Swedish buy now pay later (BNPL) fintech Klarna is now Europe’s most valuable fintech – the 4th most valuable globally – following a US$650 million equity raise that values the business at US$10.65 billion (AU$14.54bn).
The latest valuation nearly doubles the US$5.5 billion valuation following a US$460 million raise in August 2019.
The round was led by Silver Lake, alongside GIC – Singapore’s sovereign wealth fund and funds and accounts managed by BlackRock and HMI Capital.
The Commonwealth Bank previously invested US$300 million in the Swedish online payments bank for a 5.5% stake. Klarna launched in Australia in January and has around 100,000 users.
The Commonwealth Bank and Klarna jointly fund and have 50:50 ownership rights to Klarna’s Australian and New Zealand business, and the BNPL function is available through the CBA’s app for online shopping, as well as being offered to non-CBA consumers via the Klarna app.
The new valuation is likely to value CBA’s stake in Klarna at more than US$500m.
A spokesperson for CBA told Startup Daily the funding round is further evidence of Klarna’s global success and popularity.
“We’re delighted to welcome the company’s new investors on board and remain a committed shareholder and joint partner in Klarna Australia, which is offering different and exciting ways to shop for consumers and merchants here,” they said.
Previous investors include Sequoia Capital, Dragoneer, Permira, Bestseller Group and Ant Group.
The company says its app now has more than 12 million monthly active users globally.
In the land grab for customers currently underway with the likes of Afterpay and Zip, Klarna says its seeing 55,000 daily downloads of its app outpacing its nearest competitor with almost three times as many downloads over the last year.
Klarna says it added more than 35,000 new retailers in the first six months of 2020 to a network of more than 200,000 retail partners including Sephora, Groupon, Vans, and Ralph Lauren.
Volume and revenue in the first half of 2020 grew 44% and 36% year-on-year to more than US$22 billion and US$466 million respectively.
Klarna co–founder and CEO Sebastian Siemiatkowski said the shift to online retail “is now truly supercharged” and at an inflection point.
“There is a very tangible change in the behaviour of consumers who are now actively seeking services which offer convenience, flexibility and control in how they pay and an overall superior shopping experience,” he said.