Klarna losses skyrocket 500% (but so do gains) 🤯; Bulgaria's first-ever unicorn🇧🇬🦄; FC Barcelona to create its own cryptocurrency? 😮
Good Morning FinTech, March 2
Good evening Everyone,
And happy Wednesday! Due to personal reasons, today’s issue comes late. But these 3 FinTech stories are definitely worth the wait. Let’s jump straight into them:
Klarna losses skyrocket 500% (but so do gains) 🤯
Earnings 💸 Buy now pay later (BNPL) giant and Europe’s most valuable FinTech Klarna posted year-end results for 2021 that continued to show runaway success in the US and globally.
Facts & figures 📊 Here are the most important numbers you need to know:
Losses at Klarna swelled by more than five-fold in 2021 to £560M (7.1bn Swedish crowns) as it was hit by costs of entering new markets and bolstering its product offering last year.
The Klarna ecosystem now has over 147M active users and over 400,000 global merchants that drove gross merchandise volumes (GMV) to $80B in 2021. This meant a 42% year-over-year (YoY) increase in GMV for 2021. GMV growth decelerated slightly from 2020’s 46% YoY increase.
The Swedish company added 46M new consumers in 2021 via acquisitions, which grew Klarna’s global reach to 45 countries. Net operating income increased 38% to $1.6B.
The US was the second-highest revenue center for Klarna, which is now collaborating with 30 of the top 100 retail brands in the country — including Net-A-Porter, PetCo, Lululemon, Bed, Bath and Beyond, Bloomingdales, Macy’s, Converse, Ralph Lauren — and over 50 global luxury and premium retailers.
But how did we get there? 🤔 It’s obvious that the BNPL giant has expanded rapidly last year, which effectively helped bolster its user base and GMV. Here are the two most important verticals to think about:
Klarna entered 5 new markets in 2021, including France. It also grew its footprint in major markets like the UK, opening a new office in London and building out its Manchester location. The expansion helped Klarna reach new customers but obviously contributed to its losses.
It also went on an acquisition spree. Buying up companies—retail tech firm Hero, discount shopping platform Stocard, and influencer marketing startup APPRL—let Klarna improve its merchant offerings and boost customer engagement.
What does this tell us about the future of Klarna and the overall BNPL ecosystem? A couple of things: