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November 8, 2021

Klarna’s history of acquisitions: Get the data on all the deals

By Eric Johansson

Klarna has been on a massive shopping spree lately. In the past month alone, the fintech quadradecorn has bought both price-comparison site PriceRunner and travel-planning platform Inspirock. The acquisitions have been interpreted as part of Klarna’s strategy to move beyond its buy-now-pay-later (BNPL) origins to rapidly becoming a one-stop shop for customers’ entire shopping experience.

“[Big] BNPL players are becoming more like established players that offer a larger range of products, like PayPal,” Jeroen Holscher, head of global payments and cards practice at Capgemini Financial Services, tells Verdict.

The news comes at a time of explosive growth for the BNPL industry. The sector is expected to keep growing to be worth $166bn by 2023, according to GlobalData’s thematic research.

Klarna’s journey from BNPL specialist to fintech behemoth offering full payment and digital banking services has taken time. Its path from its origins as a startup launched in 2005 by three Stockholm School of Economics students to arrival as Europe’s most valuable privately-owned tech company has been paved with a number of acquisitions.

“Over the years Klarna has made strategic acquisitions that support our ambition to make shopping, banking and payments simple, smooth and stress free for consumers around the globe while also supporting retailer growth,” a Klarna spokesperson tells Verdict. “These companies have also brought great talent and technology to enhance Klarna’s products and services.”

Here’s the full list of strategic deals made by the $45.6bn fintech goliath.

Klarna made its first major acquisition in 2011, back before BNPL had even become shorthand for offering instalments.

Israeli risk and fraud management firm Analyzd marks the first company on the list of Klarna acquisitions. No financial details were given at the time. Over the next few years, Klarna continued to keep its cards close to its chest.

The next acquisition happened in 2013 Klarna bought Sofort, an online banking service, for $150m, according to a TechCrunch report at the time. Sofort is now powering Klarna’s Pay Now feature, which enables customers to pay in one go.

Buying the German startup enabled Klarna to cover 14 countries in Europe and to partner with 43,000 merchants. Today, Klarna has 250,000 retail partners around the world, covering 90 million active users and two million transactions a day.

In 2016, Klarna acquired the technological assets and the employees of Cookies Labs, a Germany-based financial technology company that provides money transfer from person to person, according to GlobalData’s Technology Intelligence Centre.

In 2017, Klarna bought BillPay, enabling it to access the German payment company’s 5,000 merchant partners.

“Combining our talent and technology will enable Klarna to continue to push the boundaries of innovation and product offering in existing and new markets with increased speed and confidence,” Sebastian Siemiatkowski, co-founder and CEO of Klarna, said at the time.

In 2018, Klarna acquired ShopCo, a German developer of browser extensions that can transform websites into interconnected online shops, as reported by GlobalData.

Details about the deal are scarce. While the Düsseldorf-based startup had raised $7m at a $27m valuation in 2017, Klarna made it clear that the purchase price was lower than the “mid double-digit millions” that German media had speculated about. The ecommerce giant told Tech.EU it had only bought the IP and eight ShopCo employees.

In 2019, Klarna bought Close Brothers Retail Finance from UK merchant banking group Close Brothers Group.

2020 proved a record year for the Swedish shopping superpower. In that year, Klarna acquired six companies in total.

It started to splurge dosh on startups in January by adding Chicago-based retail marketing venture Spring Marketplace to the fold, albeit for an undisclosed figure.

In February Klarna continued its acquisition spree by buying Moneymour, the Italian BNPL startup, again for an undisclosed sum.

Klarna followed up the deal in May by buying Britain-based online shopping portal Nuji for an undisclosed sum.

In October 2020, Klarna acquired post-purchase experience startup Woilà, including its IP and team.

In December 2020, the online shopping giant inked a $16m deal to acquire Swedish startup Search Engine Marketing that ran the two services – Semtail and Shoptail – that enabled emerchants to advertise more effectively on Google.

With just under two months to go of 2021, Klarna could be about to break its acquisition record from 2020. It has so far acquired six companies this year.

In March, Klarna acquired San Francisco-based Toplooks.ai, an artificial intelligence (AI) startup offering “shippable experiences.” No details of the financial deal were reportedly given.

In July, Klarna acquired Hero, a UK-based social shopping platform providing consumers with inspiration, advice and immediately shoppable content produced directly from retailers physical stores.

July also saw Klarna acquire APPRL Fashion, a SaaS platform enabling content creators and retailers to collaborate to bring immersive and informative shoppable content to global consumers.

The APPRL Fashion deal was followed a few days later by the news that the BNPL company had bought loyalty card startup Stocard for €110m. At the time, Stocard provided a mobile wallet to 60 million customers, enabling them to bundle customer loyalty cards in the Stocard app.

The last two deals of 2021 have already been mentioned: Inspirock and PriceRunner.

Klarna acquired Inspirock in October. The startup is an online trip planner empowering 25 million consumers per year to smoothly explore a destination’s offerings and create personalised itineraries, local expertise and AI.

“By bringing Inspirock to Klarna, we are bringing the best of Klarna’s smoooth customer experience to the travel sector,” Siemiatkowski said. “For customers, this makes the whole journey from inspiration to planning and preparing for a trip simpler, less stressful and more fun, while enabling our retail partners to better reach and engage with their audiences by offering more personalized content. It’s a natural extension of the benefits Klarna brings to payments and shopping.”

In November, Klarna bought PriceRunner, the Swedish price-comparison platform founded in 1999. BNPL quadradecacorn’s reportedly splurged almost SEK 9bn ($1.05bn) to buy the price comparison company.

What’s really interesting with that deal was that David Fock, Klarna’s chief product officer, let slip that the deal would enable Klarna to take on the Big Tech companies of the world.

“[Klarna] will not be a marketplace but a viable and competitive alternative for retail partners vs Amazon, Google and Facebook,” he said.

Deals involving any major company are listed in GlobalData’s companies data.

Verdict deals analysis methodology

This analysis considers only announced and completed deals from the GlobalData financial deals database and excludes all terminated and rumoured deals. Country and industry are defined according to the headquarters and dominant industry of the target firm. The term ‘acquisition’ refers to both completed deals and those in the bidding stage.

GlobalData tracks real-time data concerning all merger and acquisition, private equity/venture capital and asset transaction activity around the world from thousands of company websites and other reliable sources.

More in-depth reports and analysis on all reported deals are available for subscribers to GlobalData’s deals database.