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Tech stock carnage hits Klarna valuation

Tech stock carnage hits Klarna valuation

Turmoil in tech stocks appears to be spilling over to the fintech market, with reports that BNPL giant Klarna is looking to raisee fresh funds at a 30% discount to its previously sky-high $46 billion valuation.

The payments company could ask new and existing backers for as much as $1 billion in a deal that could put its post-money valuation in the low $30 billion range, sources told Bloomberg.

In February, Klarna reported soaring operating losses of $748 million for the full year 2021, driven by expansion to fresh markets and the challenges of underwriting a massive inflow of new customers. Losses for the year grew by 400%, compared to $150 million in the year prior.

The company was at the time reportedly weighing a funding round that would value it at up to $60 billion.

Some of Klarna's big backers have already re-appraised the net asset value of the stock to represent the new valuation.

The news has taken a shine off Klarna's celebration of having hit 150 million active consumers. The company currently processes two million transactions a day from a partner network of over 400,000 merchants.

Comments: (2)

A Finextra member
A Finextra member 20 May, 2022, 13:461 like 1 like

Still overpriced

A Finextra member
A Finextra member 23 May, 2022, 07:54Be the first to give this comment the thumbs up 0 likes

Since the stock is not publicly traded this valuation is a desktop excercise based on statements from the non-public company itself. Parties that invest are likely to agree to the valuation hence their investment.