Klarna eyes up IPO as it quadruples its valuation

Klarna is eyeing up an initial public offering (IPO) next year after being valued at $45.6 billion during its latest round of funding.

The Swedish buy now pay later (BNPL) firm’s chief executive officer Sebastian Siemiatkowski said in an interview that while the company wasn’t working on a listing at this moment in time, it is considering doing so.

The latest round of funding left the company valued at four times as much as it was last year and according to one of the company’s most passionate backers, it could reach $125 billion in 18 months.

Chrysalis Investments co-manager Richard Watts made the statement yesterday as he unveiled a range of the company’s latest investments.

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“Payment technology is super-hot at the moment,” he said.

Klarna was used by 87 million shoppers worldwide last year, 15 million of them in the UK and the firm is looking into taking on the traditional banking lenders.

“We want to challenge traditional banking incumbents, that would apply to everything we do and would include also a listing,” Siemiatkowski told Bloomberg.

Siemiatkowski is cautious about the market as he believes its “very volatile” however he thinks that Wise Plc’s direct listing in London last month is a model he sees Klarna potentially adopting.

Wise Plc was valued during an hours long action as opposed to a traditional investors roadshow.

While the BNPL space on the surface looks to be growing from strength to strength, there are concerns from regulators that it could be leading more people into personal debt.

Not only this, but the market is very competitive with Klarna rivalling Afterpay, Clearpay and Laybuy.

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