Woman holding shopping bags
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Klarna goes on a shopping spree

Protocol Fintech

Hello and welcome to Protocol | Fintech! This Tuesday: behind Klarna's series of deals, Amazon's struggle to make a splash in payments, and Square's identity crisis.

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The Big Story

You better shop around

After a new round of funding that left it worth north of $45 billion, "buy now, pay later" company Klarna didn't waste time in putting the fresh capital to work snapping up smaller companies.

A simple strategy would be to roll up other BNPL companies. It's not doing that. Instead, it bought four companies that flesh out the services it provides for merchants and consumers.

Rival Affirm may be more well-known in the U.S., but Klarna, born in Sweden, has been growing quickly in the U.S. It has 18.5 million U.S. customers, 1.8 million of whom are in its Vibe customer loyalty program, and 9,500 U.S. merchants. It's also available in 60,000 physical store locations in the country.

"Buy now, pay later" is becoming a commodity. Investors are pouring money into the sector, and established players are jumping in, too.

  • CB Insights is tracking more than 50 "buy now, pay later" startups. So far in 2021, they've raised $2.1 billion in 20 deals.
  • Visa, Shopify, Apple, Amazon, American Express and Citi are also playing in the space. Credit-card giants aren't going to give up their hold on consumer lending easily.
  • That means Klarna is increasingly competing not just with Affirm but tech and finance giants that all want this newer piece of the payments puzzle. What complicates matters is that some just see profits to be made, while others want strategic control of the shopping experience and customer relationship.
  • Another way to say this: The "buy now, pay later" landscape Klarna plays in now spans payments companies, online retailers, Big Tech and big banks.

Services and distribution matter. Simply offering a "buy now, pay later" option won't be enough to lure merchants.

  • Apple, for example, has the reach of Apple Pay and the Wallet software built into every iPhone. Klarna doesn't have an advantage like that. So it has to persuade merchants it can lure new customers, increase conversion rates and boost order size.
  • In March, Klarna bought San Francisco-based Toplooks, an AI company that helps merchants create customized marketing images and messaging and create dynamic pricing in areas like fashion, beauty and home decor.
  • Klarna also recently acquired London-based Hero, which helps merchants connect with customers through text messages, videos and online chat rooms.
  • On the consumer side, last week Klarna bought Stocard, a service in Germany that enables consumers to bundle cards and use them for different shopping retailers.
  • Klarna is announcing on Tuesday the acquisition of Apprl, a Swedish company that helps retailers and influencers bring content to consumers.

As ecommerce and tech players horn in on "buy now, pay later," Klarna is moving upstream into shopping and ecommerce. It's already got an app that promises "shopping inspo." The challenge will be getting merchants and consumers to buy into its vision.

— Tomio Geron


Buy-side leaders who make data-driven decisions now could prosper for years to come. That's why asset managers are prioritizing data and analytics initiatives at a faster rate than ever before. Broadridge helps you transform operations, strengthen client relationships and uncover opportunities that others may miss.

Learn more

From Protocol | Fintech

What is Square? Jack Dorsey believes bitcoin advances Square's mission of "economic empowerment." Is that enough to tie all of his businesses together?

There's a big question mark over Amazon's crypto play. It's hiring a crypto and blockchain lead. But it missed its chance to be PayPal, Square and Stripe — so is this its chance to miss being Coinbase, too?


  • "You want to look as poor as possible. You can harvest an unlimited amount of losses and carry them forward into an unlimited number of tax years."Shehan Chandrasekera, head of tax strategy at crypto tax software company CoinTracker on how bitcoin investors can avoid federal taxes.
  • "He doesn't like cursing and his character said 'f---' a few times, so he asked if they could change that and they were accommodating," —Morgan Beller, general partner at venture firm NFX, on why the script for the animated web series "Stoner Cats" was tweaked to adapt to the wishes of Ethereum creator Vitalik Buterin, who voices a cameo role.
  • "Unfortunately trading crypto will be a thing of the past, once you get past this year." —BTC China co-founder Bobby Lee on crypto's future in China.

3 Questions With...

Joe Percoco, co-CEO, Titan

What fintech sector or company is most underrated right now?

Underrated: financial infrastructure. Despite it being a buzzy term, there's still so much potential. Many core technologies still remain dominated by legacy monoliths.

What fintech trend is most troubling for you?

Gamified features that correlate to negative user outcomes. For instance, encouraging people to actively trade complex financial products they have no expertise in trading. While gamification is nice and can be an adrenaline rush in the moment, it can be really harmful to one's long-term nest egg.

What's your favorite pastime that doesn't involve a screen?

Playing soccer. I was always a center-mid. It's like jazz to me — no set plays, just coordinated spontaneity. Threading a pass through an opponent's defense is such an adrenaline rush. Creating goals is way more fun than scoring them.

Need to Know

  • Mastercard is partnering with Barclays. The financial services giant will join Mastercard's Track Business Payment Service to support corporate customers.
  • Starling Bank buys Fleet Mortgages. The London-based challenger bank is acquiring the mortgage provider for $69.1 million.

Making Moves

  • Bill Clerico joined PayNearMe's board of directors. The payments technology company praised the WePay co-founder's "operational expertise."

Deal Flow

  • AuthenticID raised $100 million. The identity-verification software company's funding round was led by Long Ridge Partners.
  • Solarisbank raised $224 million. The Berlin-based digital financial services company's series D round was led by Decisive Capital Management. The company also announced that it was acquiring competitor Contis.
  • Zilch raised $110 million. The U.K.-based "buy now, pay later" company's extended series B round was led by Goldman Sachs and DMG Ventures.
  • Paystand raised $50 million. The business payment company's series C round was led by NewView Capital.
  • Sila raises $13 million. The startup co-founded by the early fintech startup Simple's co-founder, Shamir Karkal, raised a series A for its banking and payment platform.
  • Percent raised $5 million. The charitable donation software startup's funding round included investments from Morpheus Ventures and Nationwide Building Society.


Buy-side leaders who make data-driven decisions now could prosper for years to come. That's why asset managers are prioritizing data and analytics initiatives at a faster rate than ever before. Broadridge helps you transform operations, strengthen client relationships and uncover opportunities that others may miss.

Learn more

Data Point

$955 million

That's the value of liquidated short positions following the recent bitcoin rally.

Thanks for reading — see you Friday!

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