Klarna isn’t a household name outside of Europe yet. The company only launched there in September, thanks to a partnership with Overstock.com. Still, Siemiatkowski, who met his co-founder when they flipped burgers at Burger King, believes that Klarna is already the fastest-growing fintech company in the U.S. with a run rate that’s approaching a billion dollars.
Klarna isn’t just another Stripe-like online payments-processing service. The company’s model is about separating the buying and paying process. Instead of paying at the time of purchase, you simply enter your email and ZIP code when you check out from a Klarna-enabled store and then you have 30 days to pay for the product. The company says more than 35 million people have now used its service through the 50,000 merchants that currently use it.
Klarna doesn’t “just” want to be a payments gateway — it wants to disrupt the massive retail banking market. Siemiatkowski argued that the open market in Europe made it clear that there has virtually been no innovation in the banking world for a very long time — but now that the markets are open, companies like Klarna can exploit these inefficiencies (and to do so, Klarna had to become a registered bank in Europe).
Siemiatkowski believes that there is still a lot of opportunity for a company like his in the U.S., mostly because existing players like Bill Me Later are more complicated to use. He also noted that many U.S. companies are great at presenting themselves, but once you actually look at the U.S. market, there are still a lot of opportunities there.
Asked why he chose the U.S. over a market like China, Siemiatkowski argued that out of all the markets he has looked at the one he found most competitive is China. “Alipay is killing it,” he noted, adding that he believes markets like India, Brazil and Japan are far more interesting because there’s less competition there and so Klarna has a better chance at making an impact.
With a valuation of $2.25 billion, the next logical step for Klarna may seem like it would be going public. But Siemiatkowski doesn’t seem to be eager to do so.
“It scared me a little bit to focus on quarterly returns and all that stuff,” he said. “We really like doing long-term stuff. Building great products takes a couple of years. If I’d be constantly focused on this quarter, I’d lose focus. We have a long-term vision for where we’re going.”
So while Klarna seems to be doing really well, it doesn’t look like you’ll be able to buy stock in the company anytime soon.