Klarna Goes Public: Complete Breakdown of the KLAR IPO

Let’s talk about the IPO that’s turning heads across the financial world. Klarna Group plc, the Swedish-born fintech disruptor credited with popularizing the Buy Now, Pay Later (BNPL) model, is finally stepping into the public markets. With a recent filing, Klarna is gearing up to list on the New York Stock Exchange (NYSE) under the ticker KLAR.

And Klarna isn’t doing things the traditional way. From a complex multi-class share structure to strategic insider controls, this IPO is one of the most unique public offerings we've seen from a European tech company. Whether you're a seasoned investor or just getting into IPOs, here's the deep dive you didn’t know you needed.

Who Is Klarna?

Founded in Stockholm in 2005 by Sebastian Siemiatkowski, Niklas Adalberth, and Victor Jacobsson, Klarna started with one mission: simplify online payments. What started as a humble Swedish startup is now a global fintech powerhouse operating in over 45 countries with 150 million active users and 500,000+ retail partners.

Klarna’s bread and butter is the BNPL model, allowing consumers to split purchases into interest-free installments. But that’s only the tip of the iceberg. Klarna now offers a full suite of services, including:

• Virtual credit cards

• Budgeting tools

• Price comparison engines

• Merchant marketing platforms

• Banking services in select regions

In 2023 alone, Klarna processed over $120 billion in global transaction volume, showcasing its role as a critical link between consumers and e-commerce.

Klarna’s IPO Details at a Glance

Here’s a breakdown of what the IPO looks like:

• Total Shares Offered: 34,311,274 ordinary shares

• New Shares Offered by Klarna: 5,555,556

• Shares Offered by Existing Shareholders: 28,755,718

• Expected Price Range: $35.00 to $37.00

• Exchange: New York Stock Exchange (NYSE)

• Ticker: KLAR

• Underwriters: Goldman Sachs, J.P. Morgan, Morgan Stanley, BofA Securities, Citigroup, and others

• Expected IPO Valuation: Estimated between $15 billion and $18 billion

One important note: Klarna only earns proceeds from the 5.5 million shares it is directly selling. The rest of the shares are from insiders and early investors cashing out.

Inside Klarna’s Business Model

Klarna earns revenue from several key sources:

Merchant Fees

Klarna charges retailers a fee for handling customer payments and increasing conversion rates. In return, Klarna boosts average order values and reduces cart abandonment, a win-win for sellers.

Consumer Fees

Although the core BNPL product is interest-free, Klarna collects revenue from late fees, interest-bearing financing, and monthly subscription products in select regions.

Interchange Fees

For Klarna-issued cards (physical or virtual), the company earns a small cut of each transaction processed through Visa or Mastercard.

Value-Added Services

These include targeted marketing, product placement, and analytics tools for retailers, a growing source of high-margin revenue.

In 2024, Klarna reported $1.6 billion in total revenue, with positive contribution margins in its top five markets. While it hasn't reached profitability at the net level, it’s narrowed its losses significantly compared to 2022.

Share Structure: The Triple-Class Twist

Klarna’s IPO isn’t just about going public, it's also about retaining control. That’s why the company is implementing a three-class share system:

Ordinary Shares

• Publicly traded

• One vote per share

• Full economic rights

Class B Shares

• Ten votes per share

• No economic rights

• Issued as a bonus to current holders pre-IPO

• Automatically convert to deferred shares in certain situations or after 20 years

Class C Shares

• Exclusively for CEO Sebastian Siemiatkowski and his affiliates

• Ten votes per share

• Partial economic rights (50% of an ordinary share)

• Convertible under limited circumstances

• Cannot exceed 15% of total voting power

This structure ensures Klarna’s founding team keeps tight control without needing to hold a majority of the economic equity. It’s a governance model inspired by the likes of Meta and Alphabet but taken to another level with the addition of Class C shares.

Who Really Holds the Power?

After Klarna’s IPO:

• Public shareholders will hold less than 1% of voting power

• Existing insiders will control more than 99%

• CEO and directors alone hold over 54% of total voting rights

Even though Klarna won't be classified as a "controlled company" by NYSE standards, its governance remains very much in the hands of insiders. Investors buying in must be comfortable with having no meaningful voice in corporate decisions.

Klarna's Growth and Global Footprint

Klarna is not a one-market wonder. Its strongest geographies include:

• Nordics: Still Klarna’s most mature market, showing stable growth.

• United States: Klarna has over 30 million users in the U.S. alone and growing. The U.S. is now Klarna’s second-largest market after Germany.

• UK and Europe: Klarna leads BNPL transactions in Germany and ranks among the top players in the UK, France, and the Netherlands.

• Australia and Canada: Entry markets where Klarna is investing heavily.

The company’s AI-powered shopping app now includes curated feeds, real-time deals, and personalized experiences. Its in-app browser extension for deal alerts and cashback has become a favorite among Gen Z and Millennial shoppers.

Key Metrics to Watch

Some standout numbers from Klarna’s business operations:

• 150M+ active users globally

• 500K+ merchants

• $120B+ in annual gross merchandise volume (GMV)

• Top 10 shopping app in 12 countries

• ~85% of users are Millennials and Gen Z

• Over 90% repayment rate across all BNPL transactions

Klarna’s technology stack allows for instant credit decisions, fraud prevention using AI models, and high merchant conversion rates.

Risks Investors Should Consider

Klarna’s IPO might sound exciting, but let’s not forget the potential landmines:

• Regulatory Crackdown: BNPL is under fire in the EU, UK, and U.S. for lack of transparency and consumer protection.

• Profitability Concerns: Klarna has yet to report consistent annual profits.

• High Customer Acquisition Costs: Competing in global markets isn’t cheap, and marketing spend remains high.

• Macro Environment: Rising interest rates, credit tightening, and inflation could hurt demand for deferred payments.

• No Shareholder Say: Insiders will control decisions, even on executive pay and board elections.

What This Means for Investors

If you’re considering Klarna’s IPO, think about your investing strategy. Are you looking for a long-term growth story? Are you comfortable owning shares in a company where you have no voting influence?

Klarna represents a high-risk, high-potential play in fintech. If it can turn its user base and global footprint into a path to profitability, early investors could be rewarded handsomely. But there are no guarantees.

Final Word

Klarna’s IPO isn’t just another listing, it’s a bold statement from a European fintech trailblazer. With global ambitions, a fiercely loyal user base, and a massive merchant network, Klarna is poised to make waves on Wall Street.

But this isn't your typical investor-friendly IPO. Klarna is going public on its own terms. The structure is designed to protect the vision of its founders, and that means public shareholders are essentially along for the ride.

FAQs About Klarna’s IPO

When is Klarna going public?

The official filing date is September 2, 2025, but the exact IPO date is expected during the week of September 8th.

What ticker symbol will Klarna use?

Klarna will trade under the ticker KLAR on the NYSE.

What is Klarna’s estimated valuation?

Analysts estimate a range between $15B and $18B at IPO pricing.

Will Klarna issue dividends post-IPO?

No. Klarna plans to reinvest profits for growth and expansion, with no dividends expected in the near term.

Is Klarna profitable?

Klarna has posted operating losses in recent years but has improved margins and aims for profitability within the next two fiscal periods.

Why does Klarna use a triple-class share structure?

To allow the founders, especially the CEO, to retain long-term control while accessing capital from public investors.

Klarna KLAR IPO

Klarna KLAR IPO

Financial Disclaimer

This article is for informational purposes only and does not constitute financial, investment, or legal advice. The content provided reflects publicly available information at the time of writing and may not be complete or current. Always consult with a qualified financial advisor before making any investment decisions. Investing in IPOs involves significant risk, including the loss of your principal investment. Never invest money you cannot afford to lose.