Klarna to lay off 10% of staff amid market downturn

Klarna to lay off 10% of staff amid market downturn

Klarna is set to fire 10% of its employees amid a valuation crunch at the buy now, pay later giant.

Klarna chief Sebastian Siemiatkowski broke the news to employees in a pre-recorded video message seen by Swedish tech site Breakit.

“We are strongly influenced by the outside world. When we set our goals for 2022 in the autumn, it was a very different world than the one we have today,” he said.

News of the lay offs comes as Klarna looks to raise fresh funds at a 30% discount to its previously sky-high $46 billion valuation. Battered by rising interest rates, 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.

"More than ever, we need to show laser focus on what really makes us successful in the future," Siemiatkowski told staff. "Based on this, the senior leadership at Klarna has made some tough decisions. Some of the toughest we’ve ever had to take. Together, we have re-evaluated the organisation to ensure that we can continue to deliver on our ambitious goals.

“We have done this evaluation based on two things. We have the right team that focuses on the right things. And we have the right people in the right place.”

Klarna currently employs 6500 staff worldwide.

Comments: (1)

A Finextra member
A Finextra member 01 June, 2022, 03:40Be the first to give this comment the thumbs up 0 likes

As sad ending to what could have been a successful business. It sounds like WONGA all over again.