Hello tech enthusiasts! Hope you’re ready to dive into the exciting world of fintech with me.

Swedish fintech giant Klarna is gearing up for a major milestone. On a significant Friday, it unveiled its F-1 prospectus, marking a crucial step towards its much-anticipated U.S. IPO.

With hopes to raise over $1 billion, Klarna’s target valuation stands at a whopping $15 billion, according to recent reports from Bloomberg.

Details regarding the number of shares or their pricing remain undisclosed, leaving many curious about whether Klarna will achieve its ambitious fundraising goals upon pricing.

This IPO has been in the works for a while, suggesting that Klarna’s bankers might have insights that assure investors will find this valuation appealing.

One factor potentially boosting investor interest is Klarna’s rebound in private valuation, which recently soared to $14.6 billion. The uptick came after a significant investor increased its stake in the company.

Moreover, Klarna’s financial health appears to be improving, with reported revenue reaching $2.8 billion in 2024, up from $2.3 billion in the previous year. Remarkably, the company also reported a net profit of $21 million, a turnaround from a staggering $244 million loss in 2023.

Founded in 2005 by Sebastian Siemiatkowski, Klarna offers buy now, pay later services to customers. After entering the U.S. market in 2015, it achieved a peak valuation of over $45 billion in 2021, only to see that figure drastically fall to $6.5 billion amidst the venture capital valuation bubble burst.

Recently, Klarna has made headlines by developing an in-house AI system inspired by OpenAI’s ChatGPT, transitioning away from Salesforce CRM to utilize its own internal solutions.

This pivot has led to significant operational transformations, including the replacement of 700 full-time contract employees and annual savings estimated at $40 million.

A notable consequence of this shift is that Klarna has reduced its hiring pace, causing its workforce to shrink from 5,000 in 2023 to about 3,500 by the end of 2024.