In a sign of the times, Swedish buy now, pay later giant Klarna is reportedly close to inking a new round of funding that would slash its valuation to $6.5 billion — about 1/7 of what the company was valued in June of 2021.

The Wall Street Journal reported today, citing anonymous sources, that Klarna was “negotiating to raise about $650 million mostly from existing investors led by Sequoia Capital.” Sequoia chairman Michael Moritz is also chairman of the embattled payments giant.

The deal is still in the works, reported the Journal. But if completed, it will represent a big fall from grace for Klarna, which was riding high last year when it raised $639 million in a round led by SoftBank’s Vision Fund 2 at a $45.6 billion valuation.

Klarna has been making a big push into the United States, competing with the likes of publicly traded Affirm. In early June, Klarna said that over the past year, its “U.S. customer base has grown by over 65%, reaching over 25 million consumers.” The whole BNPL (buy now, pay later) segment has taken a hit as of late, but still, the huge drop in valuation for Klarna gives new meaning to the phrase “down round.”

TechCrunch has reached out to Klarna for comment.

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