SoftBank Backs Fintech Giant Klarna to Raise $639 Million at $45 Billion Valuation

June 10, 2021 10:13 AM EDT

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Payments provider Klarna announced it raised $639 million in a new funding round led by SoftBank Vision Fund 2, along with participation from existing investors including Adit Ventures, Honeycomb Asset Management, and WestCap Group.

Other Klarna’s backers include Sequoia Capital, SilverLake, Dragoneer, Permira, Commonwealth Bank of Australia, Bestseller Group, Ant Group, Northzone, Singapore’s sovereign wealth fund, and funds and accounts managed by BlackRock and HMI.

Klarna will use the new capital to fund overseas expansion and invest in global retail growth.

The latest funding round takes Klarna’s post-money valuation to $45.6 billion, reinforcing its position as the highest-valued private financial technology company in Europe and second-highest in the world.

The company said 1% of raised capital will be invested into initiatives for promoting planet health.

Founded in 2005, Klarna is a global payments provider that allows consumers to shop, pay and bank in a smarter and more efficient way compared to traditional payments and banking methods.

The demand for Klarna’s healthier and more convenient payment solutions has been on the rise as consumers continue to keep clear from traditional credit lines where they incur interest and high fees.

"Consumers continue to reject interest-and fee-laden revolving credit and are moving toward debit while simultaneously seeking retail experiences that better meet their needs. Klarna's more transparent and convenient alternatives align with evolving global consumer preferences and drive worldwide growth,” said Sebastian Siemiatkowski, founder and CEO of Klarna.

“I'm very proud of the investors who are supporting Klarna's ambition to challenge these outdated models to empower consumers with fair, transparent, and convenient products to help them bank, shop and pay each day."

For the first quarter of this year, Klarna reported $18.9 billion, driven by growth in all markets, particularly in the United States where the company has 18 million active consumers. Klarna was ranked among the top 10 app downloads throughout the entire 2020, a momentum that continued this year as the number of downloads surged by 125% year-over-year.

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