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Industry Finance
Founded 2005 (2005)
Founders Sebastian Siemiatkowski, Niklas Adalberth, Victor Jacobsson
Headquarters Stockholm, Sweden
Area served Sweden, Norway, Finland, Denmark, Germany, Netherlands, Austria
Key people Sebastian Siemiatkowski (CEO)
Michael Moritz (Board member)
Employees Approx. 900 (August 2013)
Website www.klarna.com

Klarna is a Swedish-based e-commerce company that provides payment services for online storefronts. Their core service is to assume stores' claims for payments and handle customer payments, thus eliminating the risk for seller and buyer. About 20% of all e-commerce sales in Sweden goes through Klarna.[1][2] The company's payment solutions are offered by more than 15,000 e-stores across seven countries in Europe: Sweden, Norway, Finland, Denmark, Germany, the Netherlands and Austria. There is an office in Israel which focuses on research and development (R&D). The company has more than 900 employees, most of them working at the headquarters in Stockholm.


In 2005, the three founders Sebastian Siemiatkowski, Niklas Adalberth and Victor Jacobsson participated in the Stockholm School of Economics annual entrepreneurship award with their idea on how to provide consumers and merchants with safer and simpler online shopping payment methods. However, their idea was not received with enthusiasm and their entry was among the last in the competition. Despite this, they decided to found Klarna in the middle of 2005 and started operations in Sweden.[citation needed]

In the end of 2007, venture capital firm Investment AB Öresund invested in the company.

Three years later, Klarna started selling their services in Norway, Finland and Denmark.

In 2010, Klarna also started providing services in Germany and the Netherlands, and in May the same year, San Francisco-based Sequoia Capital entered as investors. Later that year, venture capitalist Klaus Hommels, who had previously invested in Skype and Spotify, joined the board of Klarna.

During 2010, Klarna increased their revenues by over 80% to 54 Million USD (~400m SEK).[3] In early 2011, The UK magazine The Telegraph listed Klarna as one of Europe’s 100 most promising young tech companies.[4]

In May 2011, Klarna acquired the Israeli company Analyzd, with business activity on markets in Europe, Israel and the United States. Analyzd specialise in risk management and online payments, and its founders previously worked for PayPal.[3]

In 2011, Klarna announced a new service for mobile applications which would allow consumers to purchase goods inside mobile apps without providing any sensitive data. The goal with the service is to reduce the friction during the buying process for consumers when shopping through apps.

In 2012, Klarna began offering services in Austria. Another milestone was achieved when Klarna Checkout was launched in Sweden. Klarna Checkout is a complete payment solution for the seller, and which lets the customer only to fill out minimal information (e-mailadress and zip code) to finalize their purchase. At the end of 2012, Klarna have had 9 million customers and handled 50 million transaction since 2005.

In 2013, Klarna and German SOFORT AG joined forces after Klarna acquired SOFORT from the majority shareholder Reimann Investors. Both companies would continue to offer their products side by side and operate on a stand-alone basis.



Klarna’s code base is written in Erlang, a programming language designed by Ericsson designed for highly parallel, scalable applications.

Risk model[edit]

Klarna takes both the fraud and credit risk for the merchants. To be able to take these risks, but still provide a high consumer acceptance rate, Klarna has developed risk models which at the time of the customer purchase determine whether or not Klarna will accept the fraud and credit risk for the purchase.[citation needed]


Klarna offers payment solutions, mainly for e-commerce businesses. Klarna has two main products, Klarna invoice and their part-payment solution Klarna account. Klarna mobile is a third product that yet is only available in Sweden.

Klarna Invoice[edit]

With Klarna Invoice, customers are given credit but can shop without using a credit card. The buying process differs slightly between countries. In Sweden, where Klarna was founded, customers only need to provide the e-store with their personal identity number, similar to SSN. In Germany, the customer is instead asked for basic personal data such as date of birth, gender, address and e-mail.[5]

After filling in the details, Klarna’s system makes a decision whether to approve the customer or not. If the customer is approved, a credit of 10–30 days will be given, depending on the terms for the specific store where the purchase has been made. The goods will be delivered by the store and the customer receives an invoice through mail, e-mail or SMS.[5]

Klarna Account[edit]

Klarna Account is a part-payment service where the customer chooses the amount to pay and for how many months the payment will due. All purchases made using Klarna, no matter what store, are gathered on the same invoice that is sent to the customer on a monthly basis. The customer can end the installment at any time by paying off the whole remaining amount at one time.[6]

Klarna Mobile[edit]

Klarna Mobile is a payment method specially tailored towards on-demand products, micro-payments and services where the customer need instant access to the goods. The buying process can vary for different types of products but the buyer is always verified by Klarna using the cellphone.[7] Swedish TV-channels TV4[8] and Kanal 5,[9] music streaming service Spotify, and on-demand media provider Headweb are some of the largest clients using Klarna mobile.

The service is currently only available in Sweden.

Klarna Checkout[edit]

Klarna Checkout was launched in Sweden in 2012 and in Norway and Finland in 2013. Klarna Checkout is a complete solution for sellers, offering end-customers all popular payment methods.[citation needed] The customer only needs to, thanks to the so-called "Incremental Identification", fill out minimal amount of information (email address and zip code) to finalize a purchase.

Merchant integration[edit]

Klarna provides ready-made modules for easy-installation of Klarna’s products into the store. Klarna provides these open-source modules for free on their integration site, developers.klarna.com. Klarna’s free modules support most of the largest e-commerce web applications such as Magento and OsCommerce. The company also offers an API for advanced integrations in PHP, Java, .NET, ASP or Python.[10]

The merchants handle all purchases inside Klarna’s web-based back office application Klarna online. When a consumer make a purchase, it will instantly be presented in Klarna online. Klarna takes both the fraud and credit risk for the goods and pays the merchant. When the goods are ready to be shipped, the invoice is activated and sent either by Klarna, or printed and sent together with the goods by the merchant.


In 2010, global e-commerce sales estimated $948 billion.[11] Credit cards holds the position of the most popular payment alternative in both Europe and the US by a market share of approximately 40%.[12] In some European countries where Klarna operates, like Germany and Sweden, invoice is the most popular alternative.[13][12]

Klarna operates locally in 7 European countries; Sweden, Finland, Norway, Denmark, Germany, Austria and the Netherlands, but with overwhelming emphasis in the Nordics, while trying to expand into Germany. Some of the largest competitors with similar product portfolios in these geographies include Swedish PayEx, German BillPay GmbH and Dutch AfterPay. Bill Me Later is an American company offering similar products to Klarna. Bill Me Later was acquired by PayPal in November 2008.[citation needed]


  1. ^ http://www.hui.se/web/E-barometern.aspx
  2. ^ http://www.crunchbase.com/company/klarna
  3. ^ a b http://eu.techcrunch.com/2011/05/04/klarna-acquires-analyzd-to-tie-social-to-finance-and-payments/
  4. ^ http://www.telegraph.co.uk/technology/technology-startup100/8428669/Start-Up-100-A-Z.html
  5. ^ a b https://klarna.com/en/personal/our-services/klarna-invoice
  6. ^ https://klarna.com/en/personal/our-services/klarna-account
  7. ^ https://klarna.com/sv/foretag/vara-tjaenster/klarna-mobil/direkt
  8. ^ https://www.tv4play.se/pdf/allmanna_villkor.pdf
  9. ^ http://www.kanal5play.se/info/villkor
  10. ^ http://developers.klarna.com/
  11. ^ JP Morgan Chase Research; Electronic Banking Options, Mobile Payment Forecast 2010 - 2014, August 10, 2010
  12. ^ a b http://www.researchandmarkets.com/research/9eb67b/global_online_payment_methods_2011
  13. ^ http://www.posten.se/img/cmt/PDF/distanshandeln_norden_2010.pdf