A new report from venture capital firm Accel reveals Klarna-the Swedish digital payments giant-has far outpaced all other European fintech unicorns in producing new startups. Alumni from Klarna have launched a total of 62 startups, making it one of the preeminent “founder factories” within the region.
According to the “Fintech Founder Factory” report, 82 out of the 98 fintech unicorns venture-backed in Europe and Israel have incubated 635 technology-enabled startups together. Such potential goes a long way in pointing out the importance of successful fintech ventures in incubating talent and innovative ideas. Some other standouts from Klarna alumni include Anyfin, Bits Technology, and Pretzel AI.
For comparison, employees at other major fintech companies such as Revolut and Wise have founded 49 and 33 respectively. According to Accel findings, they found Klarna’s scale and longevity add to their prolific new ventures output.
Accel partner Luca Bocchio said Europe’s maturity of fintech ecosystem, especially in cities like London, Berlin and Stockholm, is fostering an emerging environment of entrepreneurship. “Klarna is the kind of organization that is coming of age now,” Bocchio said, pointing to its scale and operational experience as key factors in cultivating successful founders.
The potential of Klarna in raising new ventures is therefore strong despite the recent setbacks following a total companywide hiring freeze and a reduction in workforce of 24%, bringing it to about 3,800. Though it downsized, the company has been using artificial intelligence to hasten its operations and boost productivity, and this has been part of its strategy to adapt to the rapidly changing market landscape.
Further, it can be seen that there is a spatial trend of startups by former employees of fintech unicorns. Around 61 percent of the new firm is sited in the same cities as their parent companies-thus making the case for geographically bound ecosystems that breed innovation.
Bocchio foresees the “flywheel effect” to persist and talent to linger in the ecosystem and continue to fire up more startups. The results show an increasingly interconnected and collaborative growth pattern for the landscape of European fintech and represent a strong evolution within the sector.
Overall, the fact that Klarna is the top incubator for young startups speaks to its critical role in building the future of fintech in Europe but also reflects broader trends in innovation and entrepreneurship in the industry at large.
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