By Björn Jeffery, SvD Tech Brief. Published in Svenska Dagbladet on 15 March 2025.
Klarna is venturing into unknown waters by applying for a stock market listing in a turbulent market. Has the company bitten off more than it can chew?
Wearing race bib number 749, Briton Derek Redmond stands in the starting blocks. It is the 1992 Olympics in Barcelona, and he is about to run the 400-metre semifinal.
Just over halfway around the track, Redmond suddenly stops and grabs the back of his thigh. He has clearly injured himself and his race appears to be over. But then he begins to hobble forward. In the final bend, his father comes onto the track and helps him across the finish line, his arm around his son’s shoulder.
The scene is legendary. Redmond becomes a hero for finishing the race in spite of extraordinarily difficult circumstances. Preparing for a potential Olympic final is the pinnacle of any track athlete’s career. You cannot give up when you have come so close.
Late on Friday evening, Klarna announced that it was formally applying for a stock market listing on the New York Stock Exchange, NYSE. The ticker will be “KLAR.” In the opening CEO letter of the prospectus, Sebastian Siemiatkowski writes that those who choose to invest in Klarna are not merely investing in a company — but in “a new era of finance.”
A lack of self-confidence has never been Klarna’s problem, or Siemiatkowski’s. But it is impossible not to think of Derek Redmond when you know what a long journey it has been for Klarna to reach this listing. And when they are finally ready to complete it — the market is the most volatile and difficult it has been in many years. One can understand how it feels too late to turn back.
The tech-heavy Nasdaq 100 index has fallen around six percent so far this year. Affirm and PayPal — two other payment companies with some resemblance to Klarna — have fallen substantially more, around 20 percent each.
Even companies like Apple — long looking almost immune to outside forces — have fallen by twelve percent. Threats of trade tariffs and a somewhat chaotic period of new economic announcements have created exactly what markets dislike most: uncertainty and unpredictability.
Klarna likes to be a challenger and to go against conventional wisdom. Its arch-enemies are the big banks and the credit cards — the entire financial establishment, really. The company is used to being questioned and criticised. The underdog role is almost embraced. Klarna does not want to be like everyone else, and thrives on that.
Running your own race is, however, considerably easier as a private company than as a publicly listed one.
Klarna is also not an underdog in the traditional sense, with 28 billion kronor in revenues and around 675,000 retail merchant partners.
Yes, the company is substantially smaller than the major American banks. But Klarna has grown. It has become extraordinarily successful since being founded in 2005. Now customers, employees, and investors depend on it directly. Just because you feel like an underdog does not mean you need to act like one.
If you have been a success in the private market, you may need to get used to becoming one among many on the exchange. And also to following the rules — formal and informal — that apply there. Macroeconomic factors carry greater weight. You are priced as a company every single day.
When market sentiment turns sour, it will affect Klarna directly — even if it has nothing whatsoever to do with them or their business.
And sour is exactly what the market is right now. Going public in the middle of this is bold, to put it mildly.
One possible explanation is that the volatile environment may persist for a long time. Trump will be president for many more years. Will he suddenly return to conventional free trade and reverse everything he has done so far? Who knows, but probably not. Waiting for more predictable times could therefore be pointless.
If Klarna intends to be a listed company for a long time, this is precisely the kind of situation it will need to navigate sooner or later anyway.
But I keep thinking of Derek Redmond nonetheless. The determination to complete your race at all costs — even when stopping might have been the wiser choice. Redmond did indeed become a hero. But he never recovered from the injury either. Two years after that famous race, he was forced to retire prematurely.
Klarna has had an extraordinarily successful journey to reach this point. One must hope they are not risking too much simply in order to complete this particular stage exactly as originally planned.
