This funding will help Klarna to continue its rapid rise in the US market, where it is currently growing at an annual rate of 6 million new US consumers. Klarna’s footprint continues to grow, now serving over 60 million consumers, 130,000 merchants partners, 1 million transactions daily and is in sight of a $1 billion annual revenue.
„The uniqueness of Klarna’s consumer offering, providing a healthier, simpler and smarter alternative to credit cards, with the addition of multiple services to smoothen the shopping experience, online and offline, is clearly resonating with the US consumer. This is as consumers are turning away from revolving credit lines towards alternative and more flexible financing alternatives. „, according to the press release.
Most importantly, Klarna’s recently launched shopping app which allows its users to shop with Klarna at any store or brand online has been received very positively, „with 3x more daily downloads than any of our direct competitors and with now more than 50% of the app users purchasing each week.”, the company said.
Klarna has also seen a surge in merchant demand for its services. Klarna is now powering over 3000 merchants in the US and helping them increase new consumer acquisition, average order value and retention. „The business results are strong, with merchants who are offering ‘Pay in 4’ reporting a 68% increase in average order value, a 44% increase in conversion compared to cards and 21% higher purchase frequency. „, according to Klarna.
Global brands H&M, Abercrombie & Fitch and Boohoo Group will soon go live with Klarna and there are currently more than a 1000 merchants integrating with Klarna with a combined volume of $10bn. The momentum of acquisition continues and in July a record number of new merchants signed with Klarna in the US.
„We are therefore delighted to announce that with the participation of the Commonwealth Bank of Australia, Australia’s largest retail and commercial bank, in the equity round, we have also agreed to establish an exclusive partnership for the Australian and New Zealand markets.”, the company added.
The funding round was led by Dragoneer Investment Group, a leading San Francisco based growth-oriented investor. Other investors in the round include Commonwealth Bank of Australia, HMI Capital LLC, Merian Chrysalis Investment Company Limited, Första AP-Fonden (AP1), IPGL, IVP and funds and accounts managed by BlackRock. This investment follows a funding round in April of this year that closed above the company’s $100 million target, driven by strong demand from Klarna’s existing investor base.
Marc Stad, Founding Partner at Dragoneer: “Our strategy is to partner with a small number of disruptive, growth companies that are highly differentiated and run by world-class management teams. Sebastian and the Klarna team have built an exceptional payments business with a global footprint, operating in a huge addressable market with strong tailwinds.”
Richard Watts, Merian Chrysalis Investment Company: “Klarna has built a highly-impressive, digital payment ecosystem, trusted by both retailers and consumers. By simplifying and improving the flexibility of the payments process, retail partners working with Klarna have seen considerable improvement in customer engagement and sales. Klarna is one of Europe’s great fintech success stories and the company continues to develop truly innovative payment solutions. This latest funding round will enable the company to execute on its ambitious international growth plans.”
Klarna is leading global payments providers and fully licensed bank, which wants to revolutionise the payment experience for shoppers and merchants alike. Founded in Stockholm, Sweden, in 2005, the company give online consumers the option to pay now, pay later or over time – offering a simple, safe and smoooth checkout experience.
Klarna now works with 130,000 merchants, it has 2,500 employees and is active in 14 countries. Klarna has been backed by Sequoia Capital since 2010 and more recently, Bestseller Group, Permira, Visa and Atomico.
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