A person who knows about the situation says that the Swedish installment company Klarna Bank AB is close to a deal with its current investors, led by Sequoia Capital, to raise new capital at a valuation of about $6 billion.
The funding round hasn’t been decided yet, but if it goes well, it will make up for a huge drop in the value of a once-soaring, buy now, pay later (BNPL) business that was once Europe’s biggest startup.
At that point, Klarna sent out a message saying, “As usual, we don’t say anything about collecting pledges or valuation theory.”
Last year, Klarna raised more than $600 million from a group of investors led by SoftBank’s Vision Fund II. This was part of a funding round that gave Klarna a value of $46 billion, which is more than a few of the major banks in the area.
Klarna is currently raising money for problems that are yet to come. This is happening at the same time as a sharp drop in financial backer premium for quickly developing tech adventures that can’t make money and are spending a lot of real money.
Valuations have gone down, and a few important tech stocks have taken a beating recently.
Affirm Holdings Inc (AFRM.O), a major Klarna and BNPL player, has lost more than 80% of its value this year alone.
On Friday, the Wall Street Journal wrote about Klarna’s latest talks to raise money.
In May, Klarna CEO Sebastian Siemiatkowski told a meeting that the company was in talks with investors to get more money and had no plans to open up to the rest of the world this year.
Klarna, one of the most well-known new tech companies in the world, was expected to go public this year. However, the market for initial public offerings has dropped sharply since 2021, when it set a record, due to market uncertainty after Russia’s invasion of Ukraine and more action in tech stocks.
