FULL TRANSCRIPT
Slava Rubin (00:00)
In this latest episode of Smart Humans, we continue our pre-IPO series, this time focused on Klarna, the buy now, pay later company from Europe. The question is, what is the right price to enter at? They've been as low as single billions, and they reached tens of billions of dollars during COVID, back down to single billions, and what is the right price now? They're growing internationally and coming now to the US, growing quickly and looking to expand their financial services. It's a very competitive market with buy now, pay later,
players across the world competing across the entire market. What is the right entry point and more in this episode.
Speaker 2 (01:03)
Thanks everybody for joining.
My name is Slava Rubin. I'm one of the founders here at Vincent and I'm joined by Jan-Erik from Sacra also one of the founders. We're super excited for today's conversation. It's the next in our pre-IPO briefing series. Today we're going to be discussing Klarna, the global payments company. So just as quick context, ⁓ Vincent is a platform for alternative investments. We have a number of different assets, including the Smart Humans podcast, the Alternative Investment Report,
and of course this pre-IPO series. And Sacra is a great research company for all things pre-IPO. And we're gonna start diving in here in just a second. First, a word from our compliance department. So nothing in this presentation should be construed as an offer to sell securities or a solicitation of an offer to buy securities. All investments involve risk and the possibility of loss, including the loss of principal.
And neither past performance nor forward-looking information is a guarantee of future results. Okay, with that said, ⁓ let's dive in. And I'm gonna hand it off to Jan-Erik in just a second to talk about Klarna. But before we do that, I do need to just set the table because we can't ignore what's happening out there in the market. Typically, we've been talking about our pre-IPO series, whether it's SpaceX or Anthropic or OpenAI. We talk about how the... ⁓
IPO window is starting to open up and things are starting to get exciting. There was a number of transactions that are supposed to be happening very soon, including Klarna, the company which we are talking about right now. But I'm sure many of you have noticed in the last week or so, there's been a lot of discussions about tariffs and this has caused a lot of impact on the public markets. So in short, it's a very volatile time and this has impacted the private markets as well.
So not just to jump ahead of ourselves here, but even Klarna has already been delayed. So we're gonna be discussing all of this. Obviously we'll focus mostly on the company, but it's impossible to ignore how the macro can affect both the company and its potential prospects for IPO. So we'll dive into that a little bit more in just a few minutes. But first let's set the stage for everybody as what is Klarna? What is the company we're talking about? Jan-Erik, take it away.
Speaker 1 (03:21)
Thank you. Let's cover the basics. So, ⁓ Klarna really is the pioneer of something we hear a lot about now, which is this buy now, pay later, or BNPL, ⁓ as I'll probably call it a lot, which is basically short-term, ⁓ in Klarna's case, ⁓ interest-free credit embedded directly at checkout. So, unlike a credit card where you pay 30 days later, you have a revolving balance with interest.
Flarna structured repayment of loans into these fixed installments, typically for payments. And the primary source of revenue for them is actually not the consumer, but the merchant. ⁓ So we'll talk about that more in business model. But the core thing is kind of the psychological appeal, right? When you buy something, have four installments in which to pay over time, ⁓ it feels like budgeting rather than borrowing, ⁓ which is kind of a key sort of a...
wedge point that they've used to get into people's wallets, especially millennials and Gen Z. ⁓ So that's the basics. ⁓ On the product side, ⁓ so credit cards have this reliance on consumer cross-subsidization. Certain people pay more, ⁓ they pay interest, they get fined, and other people get rewards, they get points because they pay on time. With Klarna, merchants foot the bill entirely for
⁓ the transaction. So they pay around four to six percent of the order value ⁓ when a consumer uses Klarna to buy something. ⁓ Why? Because when consumers use Klarna, there's measurably higher ⁓ conversion rates at checkout, ⁓ bigger basket sizes, more frequent purchases. so merchants are happy to pay. ⁓ And for consumers, the benefit is, you know, there's no ⁓
way that you're sort of being subsidized or subsidizing other consumers. And yeah, key thing, you know, it reduces friction at checkout, especially discretionary items. So a lot of their early attractions around things like fashion, things where people get to check out, they start thinking about what they're buying, how much it costs, and then they drop out. And that was one of the big places early on where Klarna and other BMPL providers have seen a lot of product market fit. And you've seen the whole gamut.
know, Pelotons, ⁓ multi-thousand dollar pieces of equipment being funded in installments down to now you have the Storedash deal. know, private taxi for your burrito being funded on installments, ⁓ but it's become a big ⁓ app. There's a whole kind of shopping app aspect to it as well that we'll get into in product, but in 32 million ⁓ monthly active users. On fundraising and valuation,
Well, it's been a crazy story. mean, they first raised 2017, if we go back at 5X revenue, it went to 10X revenue. 2021, was like 30X revenue. It went from being priced like a bank to being priced like a high growth tech company on gross revenue. So obviously this was a period of time in which this was happening to a lot of companies. They got up to $46 billion valuation, corrected the very next year to
6 and 1 billion and reflects a lot of post-FinTechs or hangover that happened there. Now, 2.8 billion in revenue. They're looking to go public at 15 to 20, so more in that range of roughly 5, 4x, sorry, 5, 6x revenue multiple.
premium to banks, but roughly comparable to what an after pay or a firm would be trading at.
Speaker 2 (07:24)
That's super helpful context. I just want to dive into the product again. So a credit card, the consumer's paying, they potentially have interest. Let's just call it 10 % interest. So if they don't pay it off right away, there's going to be some interest that starts to accrue here. There's no interest that is occurring. You're paying it in installments. So let's call it in four equal installments or more. Can you just explain again? So it's the merchant that's paying, let's call it 5%.
of the actual price of a transaction to get access to that consumer. So if a consumer is buying, let's call it a hundred dollar thing, the merchant, are they paying $5 when the consumer is paying out, converting?
Speaker 1 (08:06)
Yeah, exactly.
Speaker 2 (08:07)
And is the idea that, like you mentioned, the merchant typically wouldn't have gotten that $100 basket. Maybe it was going to be a $50 basket. But because of the psychology, now it's $100 basket. And not only is it a larger basket, it's also more likely to convert. So it's totally worth it. Is that the whole business model?
Speaker 1 (08:26)
Exactly. could be 50, it could be zero. A lot of people will just abandon. yeah, exactly. And driving new sales as well.
Speaker 2 (08:33)
So how should, can you just expand on the business model? Like is that their core revenue or are there other places that Klarna is making revenue? And if there are other places, you know, what's the mix? If you could just kind of break that down.
Speaker 1 (08:47)
Yeah, definitely. merchant fees, which is this merchant payment sort of take rate on the merchant back in like 2021, 2022, that was about 75 % of revenue. And they have diversified a bit since then in their recently filed F1, that merchant fee is now about 57 % of revenue. Almost 14 % is from these
sorry, the next biggest one is interest, is in the 20s, ⁓ low 20, 24%, which is basically because Klarna is a bank ⁓ in Europe. And so when they take in deposits from their European customers, they are collecting interest on that. Then late fees. So Klarna is not a free stuff app. ⁓ If you don't pay the installments that you owe, you are charged a fee.
that actually has risen to 14 % of revenue. And so ⁓ that's a not significant number, it's over 200 million a year. And then the last sort of main line of revenue is advertising. ⁓ And this sort of gets into the long-term ⁓ vision of Klarna, which is to not be a sort of easily commoditizable ⁓ checkout provider, but to be kind of a financial super app. ⁓ And part of that is leveraging the data that they get
from each customer purchase in order to help merchants do better advertising. So that business has done 15X over the last five years and was 180 million revenue last year.
Speaker 2 (10:24)
Got it. So can you speak to us again in terms of like the size of the organization in terms of revenue and transactions?
Speaker 1 (10:33)
Yeah, definitely. last year they did about 2.8 billion in revenue. Again, a little more than half of that is payments from merchants, ⁓ about quarter's interest. ⁓ GMV got up to over 100 billion last year. And they actually made
Speaker 2 (10:52)
Payment
is like the dollars that's going through the entire flow.
Speaker 1 (10:56)
Exactly, all the money being spent on transactions on Klarna. ⁓ So a few things. a big question about Klarna is, are they profitable? They recorded their first annual profit in five years last year on their F1. ⁓ Although they sold off one line of business ⁓ called Klarna Checkout, which sort of put them over the edge. So I wouldn't say that they're in the clear, completely profitable at this moment. ⁓
They're close. then ⁓ credit losses, I think, is the other big sort of ⁓ financial metric to look at with Klarna, ⁓ which were pretty low when they were predominantly a European BNPL and have ⁓ risen at a faster rate now that they've really expanded into the US.
Speaker 2 (11:46)
Got it. ⁓ You mentioned that they were first in the space, ⁓ basically creating buy now pay later, but there are competitors, right? One of the best known is a firm and really there's competitors that are popping up all over the place. So how is it that Klarna is differentiating and trying to stay ahead, especially as it was planning to go IPO very soon.
Speaker 1 (12:11)
Yeah, great question. So yes, the main one, the big one is Affirm founded by Max Leption, former founder of PayPal. And Affirm is probably the closest comp. They trade here as an independent company on the stock market. Affirm is a bit different from Klarna, mainly in that they focus on high ticket interest bearing loans. So if you bought a Peloton during COVID and you use BMPL, you would have used Affirm
and you would have been paying interest on that loan immediately. Because they didn't really focus on what Klarna focuses on, which is lower value items with no interest. So a firm monetizes both sides. They've monetized both the consumer and the merchant by default. And that's why they actually have a four times higher revenue per customer. So like roughly $120 versus Klarna at 30.
a bit of a different sort of a business model focusing on higher ticket items. And then the other sort of difference with the firm is, you know, a firm relies on loans to sort of fund as a funding source, whereas Clarin as a bank. So that's the main domestic competitor. You have Afterpay as well, which is, you know, I think it's useful to think of Afterpay as being similar to like a PayPal buy-in, buy-out pay later, because it's...
not a standalone product, it's integrated into ⁓ Afterpay, it's integrated into Square. And Square bought Afterpay basically because they wanted to complete the loop. ⁓ They have the merchant payment flow, ⁓ Square POS systems in a lot of businesses, they have Cash App, which is sort of this consumer facing thing. ⁓ But they wanted to have something that sort of got them into the payments loop with more businesses.
And so they bought Afterpay sort of to plug into this ecosystem and get them data on what people are buying from retail and enable a lot of these things like embedded financing and ads ⁓ that Klarna is on the road to and in the progress of doing. And the last one quickly is a lot of these credit card companies have this now. Like I have a Chase card. I was informed that I can't use Klarna anymore. I can use Chase.
buy in for or chase pineapple later, American Express has buy in for. ⁓ So all the major banks are getting in on this too, because it's clearly a sort of method of buying with product market fit. ⁓ The thing I see is that I don't get personally as a customer, I don't get pushed to do this at all by Chase or American Express. And I think that they're not pushing it because it cannibalizes the core credit card business. I mean, it's not as profitable as having people spend on their credit card.
So I think they'll have it, ⁓ they'll all have it, but I don't see them really aggressively pushing it basically to avoid cannibalizing the core business. ⁓ But it's definitely a crowded landscape for sure.
Speaker 2 (15:14)
Yeah, definitely seems crowded. Just look at the logos that are on the actual image. You mentioned that Klarna, one of their differentiations is that they're a bank. So can you speak to the pros and cons about that? And is that a long term differentiation or a mode that they could build on? Or is that really going to be a problem?
Speaker 1 (15:32)
Yeah, it's useful because they get better rates. Obviously, they're not relying on externals ⁓ to help them fund the purchases. So for example, you could think of all these American ⁓ consumers using Klarna to buy a burrito on DoorDash. That's being backed up by the reliable deposits of
European Klarna customers who put their money into Klarna and have their Klarna withdrawn from their debit, ⁓ like responsible consumers subsidizing the American consumers' appetite for burritos. ⁓ Now that obviously provides some advantages in terms of just like cost of capital, but then there is potential downside because they're under more scrutiny as a bank. ⁓ And actually they recently shifted their legal
⁓ entity to the UK. ⁓ Part of the rules are tougher in Sweden on banks. So they're trying to get over to ⁓ more favorable ⁓ jurisdiction where they can operate more freely as a bank. ⁓ I think in the US, ⁓ pre-election, the main concern would have been the Consumer Finance Protection Bureau because they were looking closely at BNPL and especially the fact that
Some, you know, a third of BNPL using consumers have multiple ⁓ loans going on at once. You know, there was some concern that this was overextending consumer credit, ⁓ I think, you know, given that I think the Consumer Finance Protection Bureau is no more, ⁓ or workers have been barred from entering the offices, I think that particular concern is probably moot for the next four years at least.
Speaker 2 (17:19)
So when I look to invest into a pre IPO company, I want to think that it's like massively differentiated and quite unique. And ⁓ an exaggerated example of that is SpaceX. It feels like they're so unique and even the couple of competitors are competing feel like they're way behind. Here it feels in my opinion, like this is definitely crowded. So I know we're just double clicking on this even further. What's the argument for
Clarnet is differentiated and it's going to be able to stay heads and shoulders above all of these other folks trying to do the same thing.
Speaker 1 (17:55)
Yeah, it's definitely not as clear cut of a situation as SpaceX. And I agree, a firm, despite this difference of business model, they're very similar in terms of the core business. The thing I think works in Klarna's favor is that they have gone after these low ticket items. And like even the DoorDash deal, which I think it's easy to kind of, you and I laughed when I first saw it. I think it speaks to a larger vision, which is a view putting every purchase through Klarna, you know.
And I don't think the other BMPL players are going after that. ⁓ At least the firm, you know, isn't, you don't really see ⁓ after pay in that same boat. So Klarna feels like the one that's really going after the broad mass consumer. And then they have built a strong brand. I mean, it's sort of intangible, but among Gen Z, millennials, ⁓ BMPL is more popular. Klarna is sort of the most popular.
as a brand in that space. so they're kind of building on that and building towards being a shopping destination app, which we can talk more about. ⁓ I think the key thing is that sort of strategy and then the brand and in a way the banking cost of capital advantage is nice as well. But ⁓ I would agree with you in general that differentiation is not huge between them.
Klarna and these other players.
Speaker 2 (19:26)
You signaled a couple of times about the potential future becoming a shopping app, a destination, et cetera. Let's shift towards the future. What can this look like in the years to come? First, give me the perspective on the shopping destination and what are the potential outcomes here? What are the upsides? What are the risks? What's the bull bear potential cases? I'd love to hear your viewpoint on where this is headed.
Speaker 1 (19:51)
Yeah, so to talk a little bit about the bull case, ⁓ which I think is really interesting is that ⁓ Klarna has a very unique positioning where they're between the merchant. ⁓ They sit between the merchant and the consumer. They're at the e-commerce, the checkout page, ⁓ and they see the entire transaction before it gets sort of ⁓ obfuscated by a credit card processor. So if you go and buy five shirts from H Klarna sees the individual item, they see the price. ⁓
they see the brand, the category, the size of shirt that you've got. They get this basically gold mine of data. And when they get that data, it allows them to sell better advertising services into merchants, which we've seen become significant. mean, still very much nascent at 180 million, but significant line of business. And then it also allows them to do better retargeting.
better sort of sponsored placements, affiliate offers towards consumers. And that's what they've been really cramming into the Klarna app, which is basically a place where you go and you can buy anything ⁓ in installments via their marketplace, which, you know, via these partnerships that they've done includes like Nike, Macy's, Airbnb, H ⁓ Instacart. You know, they're now ⁓ sort of a big partner of Walmart.
who dropped a firm. So, you know, and this app has tens of millions of monthly active users. So I think this is really the story that they're telling and that they were especially telling in 2021 is that we're not just a payments provider, right? We're a sort of marketplace for goods and people want to buy through us because of the unique psychological nature of the budgeting and installments as a better way to pay versus using a credit card.
And when we have sort of an aggregate of consumers using Klarna, we also get this huge amount of few level data that we can sell back to merchants to make their business better and to give them better advertising tools and things like that. So that's really the big picture vision. I think, you know, if we look at sort of the bear case, know, credit losses are, you know, we're up 40 % year over year in 2024.
And this has been a problem for Klarna as they've gone into the US. ⁓ Also, obviously it's great to generate revenue, but generating almost 400 million from late fees is kind of a bittersweet because you are not necessarily fulfilling your vision of being a better alternative to credit cards if you're collecting this much revenue from late fees. So there's definitely,
struggle there, you know, potentially brewing if they cannot bring the credit losses down over time. Obviously, regulation, all that is also a problem. And I think Apple, you know, Apple has a BMPL offering. It's not super well integrated into like the double tap Apple Pay, but that I think would be a big risk. You know, I think the bear case is that they do end up sort of one among many checkout buttons.
in the end and that convenience of Apple Pay ⁓ or competition with other players doesn't allow them to really get that aggregate scale of data necessary to take that next step.
Speaker 2 (23:27)
Just to jump in here, if anybody has questions, feel free to send them in via the Q &A. You mentioned that Walmart transitioned from a firm to these guys. ⁓ That sounds like a big move. Do you have any insight on that?
Speaker 1 (23:41)
Yeah, there's a little bit ⁓ of PR ⁓ mystery around it. relates to their, ⁓ Walmart owns this Fintech startup, ⁓ OnePay, and it's like a digital wallet for your Walmart rewards. And Klarna is now going to be the exclusive provider of BMPL loans through OnePay. ⁓ So yeah, there's still a little bit of...
this dropped right before the IPO offering. Obviously, ⁓ great news ⁓ until Trump kind of ruined the IPO. ⁓ So we're not exactly sure all the details on that, but it's definitely a big move, especially unseating a firm from that spot.
Speaker 2 (24:29)
Absolutely. And you mentioned that the credit losses went up 40%. I mean, that sounds significant for year over year for it to go up that much. How do they compare to a firm or others or as an industry benchmark on their on their defaults and losses?
Speaker 1 (24:44)
Yeah, so 500 million in 2024, about. And that's about a half of a percent of their GMV, which is roughly in line with industry averages, but it is about 18 % of revenue. So that's meaningfully higher than other players. I don't have the exact numbers on a firm, but that's higher. And I think a lot of that is sort of aggressively coming into the US market.
⁓ And, you know, I guess US consumption behavior is a little different from Europeans. So ⁓ it was part and parcel of expanding to the US, but it is an indication that, you know, ⁓ it is part of aggressive expansion for a company like Klarna, because, I mean, Klarna can juice revenue just by offering more loans aggressively. And that's sort of what they've done. ⁓ So I...
I think we'll going forward, they have to have better ⁓ balancing of ⁓ growth with the credit losses. They do have underwriting processes. I think there's a one strike policy basically if you miss payments supposedly and then ⁓ AI risk models, but ⁓ that will be key to sort of keeping things afloat long enough to make this big picture vision happen.
Speaker 2 (26:11)
Can you give me a perspective on what the few years out vision could look like in terms of the Bull and the Bear case or the base case?
Speaker 1 (26:18)
Yeah, think, you know, three years, let's say three years from now, so like end of 2028. You know, I think my personal base case is that we start to see the ⁓ further glimmers of this, you know, advertising business growing. We start to see more usage of the app as a shopping destination and it doesn't become kind of the financial super app.
quite yet, but I think in three years, we would want to see sort of evidence of that happening. I personally, you I think 5 billion in revenue by the end of 2028 is a reasonable expectation. And then, you know, 5 billion, let's say, ⁓ you know, six, seven X multiple, you know, 30 billion, 35 billion market cap ⁓ is where I would probably land.
Speaker 2 (27:09)
Wow, and what's the multiple now on affirm?
Speaker 1 (27:14)
Yeah, a firm, they're trading, like you got to check every 10 minutes, 11 billion. And I think they actually had revenue that was almost identical to Klarna's in 2024, just about 2.8. So if I do my quick non-submental math, it's about a 4X. But then again, it's been a down 40 % year to date for a firm. So we're in a crazy time.
Speaker 2 (27:44)
Right, so a firm has seen as high as like maybe 8 to 10x.
Speaker 1 (27:48)
Yeah, exactly.
Speaker 2 (27:49)
got it. So I mean, this is very interesting perspective. So your bear case on let's call it approximately 5 billion of revenue on a 5x multiple is around $24 billion. And that's that's kind of your bear case for ⁓ for 2029. Let's put that into perspective. Where do you think I think the IPO market was planning to price it around 15 to 20 before all this tariff talk? Is that right?
Speaker 1 (28:17)
Yes, I think that's what they are aiming for.
Speaker 2 (28:20)
Right, and that would be on the 2.8 now, so that was like a six multiple, let's call it, six, seven multiple.
Yeah. Do you think this is really hard to predict now, but ⁓ do you think that's a good price? Do you think with all this tariff talk, if well, first, let me ask you this, which we all have opinions. So you are worthy of having yours. Are they going to IPO this year?
Speaker 1 (28:43)
⁓ I think I've become such a, you know, I've become so skeptical that anything coming out of this administration right now is truly a durable decision. I guess, ⁓ you know, I mean, off topic for a second, but they reported that they were going to cut the Pentagon budget by 8 % a year. And then they came out yesterday and said they're going to have the biggest ever Pentagon budget for next year. So our Andoril coverage was, you know, thrown out of kilter, but
I think, I mean, my personal feeling is they will IPO, so will Inch Health and all these other IPOs, ⁓ StubHub that I've had, you know, put on a temporary pause right now ⁓ because of just like, I mean, the stock market being so volatile, they don't want to go public, but I think that they will.
Speaker 2 (29:32)
And if you had to predict when, are we talking like in one week, one quarter, ⁓ in November? Just for the sake of ⁓ the conversation here, give me a month. What month are they gonna ⁓ deal?
Speaker 1 (29:45)
⁓ yeah, it's tough. Maybe, maybe, yeah, next quarter, would say like, let's say like, yeah, like a June, I think doing it immediately is questionable.
Speaker 2 (29:55)
⁓ I might not be as optimistic. ⁓ I do think they will IPO this year. I'm seeing more of a H2 second half of the year type of thing. Do you think that given the macro ⁓ that is still gonna come in at the 15 to 20 kind of price point as it's starting to grow a little bit more on revenue? Or do you think that it's gonna be lower or higher or it's kind of just gonna move and just take a pause?
Speaker 1 (30:20)
Great question. ⁓ I think if we continue to engage in a reciprocal tariff war, I think that could have a drag on the valuation. Because a lot of the story Klarna is telling right now is about the US. ⁓ The US has become the biggest market by revenue, ⁓ grew 40 % last year. So if you throttle back the US consumer's ability to spend money, ⁓ I think that could have a big effect.
they might have to sort of circle back to their strength in Europe as a storyline. But at the same time, I I guess it's possible that reducing the spending ability of the US consumer could be also a tailwind because force people to other forms of payment besides debit and credit. But I think very well could have a drag.
Speaker 2 (31:16)
So let's just say the price is 15 billion. Are you buying it today at the IPO or in the pre-IPO?
Speaker 1 (31:22)
I think so, because I like Klarna. think I like buying with Klarna myself, even though...
Speaker 2 (31:28)
You
say you like Karnat, you like the product.
Speaker 1 (31:31)
I like the products and then often, you that informs a lot of my decisions ⁓ in the markets, ⁓ you know, of course with the benefit of research behind it. ⁓ But I like it. And I think for me, the core thing is ⁓ the psychological trick that they do is getting you to think of, you know, buying as renting almost. Like if I buy a shirt, I'm going to pay over the next three or four months that I enjoy that shirt.
rather than paying it in 30 days or paying for it now. And if I had a star on a button on every transaction, I'd probably do it. Might be the pink branding appeals to me, but I think they have a shot at getting towards this sort of, know, stopping out vision. I like the advertising products. I like the data sort of business that they're building underneath it. And from talking to other people, you know, see a lot of people, especially younger.
millennial Gen Z's love Klarna ⁓ and spend a lot of money through it. personally, I am.
Speaker 2 (32:39)
All right, and if you had to predict, obviously you gave the bull bearer and base case, but what's the Yonair prediction three years out? If it's worth 15 billion today, what's it worth three years from now?
Speaker 1 (32:49)
I think I'll go with the base case, 5 billion three years from now, let's say 7x, so 35 billion.
Speaker 2 (33:00)
Okay, I mean, that's a considerable return. Obviously, you could be in the ⁓ just in the Dow or the S &P, you're not going to get over 100 % return in three years. That's pretty considerable. I my opinion is that Klarna has been around for a long time, definitely has durability. The competition, in my opinion, is severe. ⁓ So I think that makes it very, very, very complicated for it to be really a breakout winner. Do I think it can be the steady eddy and kind of continue to grow? ⁓
almost be like a yield play where it just keeps on getting some returns. I do think that's possible. I'm not sure if this is the space that I'm personally most excited about investing in just because of its lack of moat. I do love the way you positioned the things that do make it awesome, which it really resonates with the young people. It has incredible access to data.
and the fact that it has this cheaper cost of capital because of the bank option is super interesting. If all of a sudden, like you said, several years from now, Klarna becomes the place to quote unquote, rent your way to purchasing, that's super interesting, but it just feels very competitive to get there. So I would not bet the farm on it, but I don't think it has a ton of downside is my opinion.
Speaker 1 (34:23)
I just got to see if I can use Klarna to buy Klarna stock. I don't know if they've offered that yet, but I that'd be great.
Speaker 2 (34:28)
That is absolutely brilliant alongside with your burritos through DoorDash. Excellent. Well, ⁓ thank you. So ⁓ that completes our conversation here with Klarna. I just want to check if there was any other questions that came in. ⁓ we do have one. ⁓ Fintech has been challenging for a few years. ⁓ Do you think for Klarna to go out IPO that it means Fintech is back?
Speaker 1 (34:54)
Hard to say. ⁓ I think Klarna is to some degree, you know, obviously included in a lot of that, ⁓ the FinTech recession that we had. ⁓ And I probably wouldn't think of it as FinTech being back so much as, know, Klarna is sort of ready to go public and they also want the financing from doing it. ⁓ But
Yeah, I think we'll have to see. I'm not sure that I'm ready to say that the wider FinTech sector is back just with with Clarnet going public.
Speaker 2 (35:29)
Yeah,
and a perfect example of that is for anybody looking to maybe get into Klarna, you should take a look at the Affirmed stock. The Affirmed stock has been all over the place in the last few years. It's had very low lows and very high highs. Right now, it's somewhere in the middle there. But, know, FinTech has definitely been volleyed around on its multiples, especially as it relates to the economy and interest rates. So I think you'd be playing right into that with Klarna.
Well, thank you very much, Jan-Erik, and thank you everybody for joining. That completes this episode on Karna.
