Klarna: Swedish fintech valued at over $15 billion

Swedish fintech company Klarna achieved a market value of just over $15 billion in its initial public offering (IPO) in the US, marking an important milestone for the company after its earlier plan to go public failed due to market instability caused by tariff measures. Klarna offered its shares at $40, above the previously announced range of $35 to $37. The company raised just under $1.4 billion, and the offering was about 26 times oversubscribed. At a price of $40 per share, Klarna’s business is valued at approximately $15.2 billion.

This online payment company was among a number of firms that paused their IPO plans earlier this year after US President Donald Trump announced a broad tariff package in April, which triggered significant market instability. However, the US initial public offering market has revived in recent months, with reduced volatility. For instance, software company Figma and cryptocurrency exchange Bullish each raised over $1 billion, while the cryptocurrency exchange Gemini, led by the Winklevoss twins, is preparing for its debut later this week.

Klarna is a pioneer of the ‘buy now, pay later’ (BNPL) model, which offers interest-free installment loans at online merchant checkouts. Such loans have gained significant popularity in recent years, especially in the US, where the company has been aggressively expanding its business. A successful IPO represents an important milestone for this 20-year-old European fintech company, which has gone through management crises and significant fluctuations in investor sentiment over the past decade, according to industry experts.

Klarna’s stock value has drastically fallen from $46 billion in 2021, after SoftBank led an investment round that made it the most valuable European startup at the time, to just $6.7 billion in 2022, when rising interest rates halted investments in loss-making startups. Additionally, last year, the company faced a months-long management conflict that ended with the removal of a close ally of co-founder Victor Jacobsson from the board.

Expensive Expansion

Klarna operated profitably until 2019, but then embarked on an expensive expansion into the US market, consciously accepting significant losses while adjusting its user credit assessment system. Its business model often sparks controversy. Critics argue that this form of lending encourages irresponsible borrowing among vulnerable consumers, and there are concerns that a potential recession in the US could jeopardize the quality of the company’s credit portfolio.

Although Klarna generates most of its revenue from merchant fees, consumer advocates warn that the ‘buy now, pay later’ model has predatory elements, as it charges penalties to users who do not pay their installments on time. According to data from the IPO documentation, 13.6% of revenue last year came from ‘reminder fees’ and ‘snooze fees’ incurred when customers are late with payments or choose to defer payment. Additionally, following the example of many fintech startups, Klarna aims to become a full-fledged digital bank and recently launched its own debit card, thus expanding its offering of traditional loans with interest, while CEO Sebastian Siemiatkowski announces ambitions to enter the crypto sector.

In the second quarter of this year, Klarna reported a net loss of $53 million, more than triple the loss of $18 million in the same period last year. Its revenues grew by nearly 21% to $823 million. For the entire previous year, the company achieved a net profit of $21 million, compared to a loss of $244 million the year before. Despite the new valuation, Klarna’s value remains significantly below that of its US rival Affirm, which went public in 2021 with a valuation of $12 billion and is now worth about $29 billion.

Largest IPOs in 2025

With its IPO, Klarna joins a series of major initial public offerings this year that signal a recovery in the capital markets after two years of stagnation. The largest IPO to date belongs to software company Figma, which raised over $1.2 billion in August and achieved a market capitalization of around $56 billion.

Among the largest tech offerings is CoreWeave, a cloud infrastructure provider linked to artificial intelligence and blockchain, which reached a company valuation of $107 billion, making it one of the most valuable new stocks of the decade.

The fintech sector, which includes Klarna, was marked by the IPO of Chime Financial with a market value of $18.4 billion, while in the crypto sector, Bullish and Gemini attracted attention. The latter, the cryptocurrency exchange of the Winklevoss brothers, aims for a valuation of around $3 billion.

Globally, a mega-offering is also expected in India, with telecom giant Reliance Jio Infocomm preparing an IPO worth about $6 to $7 billion, which would be the largest public offering in the history of the Indian capital market.