Klarna hits 150M users but will cut its valuation by 30% 🤯 (& what this means for other FinTechs); Stripe vs. Plaid: Round 2 🥊; Revolut's native token & Web3 wallet 👀 (huge risks involved)

Good Morning FinTech, 23 May

Good day Everyone,

And happy Monday! I hope you took some deserved rest on the weekend as today’s issue is super hot. From Klarna hitting a huge customer milestone yet slashing its valuation by 30% to Stripe vs. Plaid fight intensifying (+ showing the great FinTech Convergence) and Revolut doubling down on crypto (with huge risks though), it’s something you absolutely can’t miss. Check it out & see yourself:

Klarna hits 150M users but will cut its valuation by 30% 🤯 (& what this means for other FinTechs)

The good news 🗞 Swedish Buy Now, Pay Later (BNPL) giant Klarna has just reached the 150 million user mark. Less than 10 years after crossing 10M users, the BNPL heavyweight has grown by as much as 15x. That’s pretty impressive.

To put this into more context, the 150M customer milestone puts Klarna far ahead of the BNPL competition. Afterpay (now part of Block) has 20M, active customers, Affirm last reported 12.7M users, while Zilch, founded only in 2018, reached 2M users earlier this year.

In addition to that, the FinTeh giant, which launched in 2005, has also recently hit 400,000 merchant partners. Obviously, this isn’t as impressive as PayPal’s 20M merchant accounts, but a solid achievement regardless.

The bad news 🚩 Despite hitting a massive customer milestone, Klarna is about to devalue itself. The FinTech giant is reportedly eyeing new fundraising that could put the Swedish BNPL’s valuation close to an estimated one-third below the roughly $46 billion it came in at less than a year ago.

The payments company could ask new and existing backers for as much as $1B in a deal that could put its post-money valuation in the low $30B range, sources told Bloomberg. We can remember that Klarna hit a record-high valuation for a European FinTech last June following an investment by SoftBank.

In addition to that, the company was reported previously being in talks with investors to raise money at a whopping valuation of $60B but saw some investors backtrack owing to volatile market conditions and a funding slowdown.

So what does this mean for the future of Klarna and other FinTechs? Here’s the takeaway: