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U.S. Rapper A$AP Rocky Invests in Swedish Klarna

By Kajsa Norman

American rapper Rakim Mayers, known professionally as A$AP Rocky, has invested in Swedish Klarna, an e-commerce payment solutions platform and regulated bank, best known for its “buy now, pay later” model. As part of the deal, Rocky acted as chief executive of Klarna for a day, setting out to “renounce the global fashion hibernation” that dominated 2020 while inviting everyone to “rediscover the joy of getting dressed.”

Founded in 2005, Klarna offers shoppers interest-free financing on retail purchases over a period of instalments. The company currently boasts a $31 billion valuation but is in the process of raising a new round of funding that could lift its valuation to

A$AP Rocky + Klarna. Photo: Klarna

close to $50 billion, reported Reuters. The company has over 200,000 retail partners, including H&M, IKEA, Expedia Group, Samsung, and Nike, as well as over 90 million active users all around the world who conduct an average of 2 million transactions per day. The number of U.S. consumers using Klarna more than doubled to 17 million in April 2021.

Klarna is growing fast in the United States, particularly with young shoppers, but its buy-now, pay-later credit system has been criticized for glamorizing debt among young people.

“It’s a radical way to approach the crediting system,” says A$AP Rocky. “It helps people with financial literacy.” The rapper claims his own experiences growing up in Harlem and understanding the difficulties of making payments for people from low-income backgrounds, is what motivated him to invest in the company. The investment is also a new chapter in what Rocky describes as the “funny history” between himself and Sweden.

In 2019, Rocky was arrested in Sweden and was held for nearly a month in pre-trial detention, following a street brawl in Stockholm. Then-U.S President Donald Trump attempted to intervene on Rocky’s behalf, but to no avail; the rapper was convicted of assault and given a twoyear suspended sentence.

Other celebrities who have supported Klarna include hip-hop legend Snoop Dogg and pop star Lady Gaga.

Record Number of New Listings

Never before have so many new Swedish companies been listed on the Stockholm Stock Exchange. When the COVID-19 pandemic first hit, stock markets collapsed globally. However, they soon recovered and have since experienced phenomenal growth. The Stockholm Stock Exchange has grown by more than 50 percent in the past year. This trend of growth has attracted a record number of new companies.

“There is a strong interest in the stock exchange with many companies wanting to get listed,” says Adam Kostyal, head of European Listings for Nasdaq, who predicts a record year.

In the first four months of 2021 alone, 35 new Swedish companies were listed on the stock exchange. Most of these companies belong to the tech industry.

Another Massive Loss for SAS

The COVID-19 pandemic has hit the travel industry hard, with airline SAS reporting big losses in its fiscal second quarter. While losses before tax were smaller than a year earlier, they still totalled 2.36 billion SEK ($283.95 million) compared to 3.72 billion a year earlier.

The number of passengers in the period declined by 140,000 compared to the first quarter, causing revenues to fall by 15 percent compared to the preceding quarter and 63 percent from a year earlier.

Last year, SAS cut 5,000 jobs, 40 percent of its workforce, but it wasn’t enough. Now, both Sweden and Denmark have offered the airline a joint 3 billion SEK ($361 million) loan guarantee. The Swedish state owns 14.8% and the Danish state owns 14.2% of SAS. The airline received a similar loan and a capital increase last year.

SAS said this credit line should be seen as a complement to other efforts to cut costs.

“The increase in vaccination rates provides some hope for the relaxation of restrictions, and an increase in demand ahead of the important summer season,” chief executive Karl Sandlund said in a statement.

However, he noted that “many customers are now increasingly choosing to book their tickets much closer to their travel dates, which makes it difficult to predict demand during the summer.”