Swedish Fintech Klarna took the next step with the highly anticipated US IPO when it published its F-1 prospectus on Friday. We are now sifting through the documents.
Klarna hopes to raise at least $1 billion at the IPO last week at a $15 billion valuation. The public documents have yet to disclose the number of shares or price ranges to be sold, so it is not clear whether the IPO meets funding aspirations. It usually takes a month, sometimes longer, after the prospectus document is published to bite.
However, this IPO has been anticipated for years, so perhaps the banker suggests that investors will chew on that level.
Reports say one reason is that Klarna's previous private valuation has recently rebounded to $14.6 billion after one investor increased its shares.
The other is that Klarna reports profits. Specifically, Klarna reported revenue of $2.8 billion in 2024 in 2024, starting from about $2.3 billion in 2023. It also reported a net profit of $21 million in 2024, a major swing due to a loss of $244 million in 2023.
Founded in 2005 by current CEO Sebastian Siemiatkowski, Klarna is one of the players who are buying the purchase now and paying the customers later for the purchase. After launching in the US in 2015, Klarna had received a hefty valuation of over $45 billion by 2021. This is the figure that plunged from 85% to $6.5 billion when the 2021 venture capital valuation bubble burst.
Klarna recently developed its own in-house AI system based on Openai's ChatGPT, and says Salesforce CRM has removed the contract to use the internal system instead.
Siemiatkowski said the customer service BOT powered by homemade ChatGpt has replaced 700 full-time contract employees and savings of around $40 million a year. He even went to say that Klarna actively halted employment for AI use, and that the workforce had dropped from 5,000 in 2023 to about 3,500 by the end of 2024.