Klarna's IPO Hopes to Spark UK Fintech Listing Boom

Klarna's upcoming US IPO could trigger a wave of British fintech listings, Reuters reports. The Swedish buy-now pay-later company is expected to command at least $15 billion in its New York Stock Exchange debut, potentially inspiring other UK-based fintech firms to follow suit.

"Any successful IPO of a high-profile business in the sector will be a catalyst for others to look again at an IPO as a strategic option for growth and/or liquidity," said James Wootton, a partner at Linklaters, to Reuters.

Klarna's IPO comes after a period of relative inactivity in the tech IPO market, particularly for fintech companies. In 2021, 101 fintech companies raised $296.86 billion through IPOs globally, but that number dwindled to just 86 firms raising $32.76 billion between 2022 and 2024, according to data from PitchBook.

"It’s quite clear that the market is looking to Klarna as a bellwether for future fintech IPOs, many of which are in a long pipeline," said Tim Levene, chief executive of London-listed fintech investment fund Augmentum, to Reuters. "We hope that Klarna is the first of many to list, which will prove a positive data point for the rest of the market."

Several UK fintech companies are reportedly considering IPOs in the near future, including challenger banks Monzo and Starling, as well as payments companies Zilch and Ebury.

Zilch, a competitor to Klarna in the buy-now pay-later space, is currently aiming for a 2026 IPO, according to its chief executive, Philip Belamant. He described Klarna's IPO as a "significant moment" that could boost investor confidence in European fintech listings.

Ebury, a Spanish-founded payments company majority-owned by Banco Santander, is also gearing up for a London IPO as early as June, potentially seeking a valuation of around £2 billion ($2.6 billion), according to sources.

Revolut, Britain's most highly-valued startup, has previously expressed interest in going public, while Zopa, another London-based fintech company, is also considering an IPO but has yet to set a firm timeline.

The choice of a US venue for Klarna's IPO is likely to intensify the debate over where these fast-growing companies should list. Monzo has reportedly discussed both UK and US listings, while Zilch is also reportedly considering its options. The London Stock Exchange has been actively courting fintech companies, but the ultimate decision will depend on a range of factors, including market conditions and regulatory environment.