Klarna has become Europe’s top fintech for producing founders from its former employees. A total of 62 startups have been created by alums from the Swedish buy now pay later giant, according to data released today by VC firm Accel and data platform Dealroom.
Revolut, last year’s top dog, is in second place with 49, while money transfer app Wise scores bronze with 33 startups founded by ex-employees.
Klarna’s total is almost double last year’s 32. The number of former Revolut founders has increased by 44% year-on-year. Accel partner Luca Bocchio tells Sifted this is due to both the size of the companies — Klarna has around 3,800 employees; Revolut has more than 10k — and their culture.
“I think both of those names [Klarna and Revolut] are famous for having a culture of independent teams working on new products, ideas and launches,” he says. “So naturally you have a lot of individuals that are being exposed to that modus operandi and then they can take the leap of faith and go out by themselves.”
The fintech flywheel
Sifted has previously reported on the many founders that have left Europe’s top fintechs to raise funding for their own ventures. In August, alumni from Monzo raised £2.8m led by LocalGlobe to build an AI customer service tool that “acts like humans”. Last month, former Revolut product lead Bogdan Uzbekov raised $30m in Series B funding in a round led by Zinal Growth, the tech fund founded by Checkout.com founder Guillaume Pousaz, for his SME superapp company Apron.
Accel and Dealroom identified over 625 startups founded by former fintech unicorns in the data (which also covered Israel as well as Europe). 53% of these new startups have already gone on to secure more than $1m in funding, with 35% of those sticking to building in fintech.
That’s even as funding and valuations for Europe’s fintechs have yet to return to the heady heights of the pandemic era. In 2021, $16bn was invested into European fintech, shepherding 32 new additions to its unicorn stable.
Comparatively, 2024 has only seen five fintechs reach the $1bn price tag. Some, such as payments fintech TrueLayer, have even lost their unicorn status this year.
Bocchio says, however, that a steady supply of new $1bn valuation fintechs isn’t needed to maintain Europe’s supply of founder factories.
“The ecosystem is much more healthy if you see a good continuous volume of interesting companies emerging and good entrepreneurs starting new businesses,” he says. “Which I think is what we’re seeing regardless of macroeconomic cycles.”
London leads on fintech
While Stockholm-headquartered Klarna may be Europe’s top founder factory, London is Europe’s most productive fintech hub for startup spinouts. London has generated 234 startups founded by ex-employees of the 24 fintech unicorns based in the UK capital. Stockholm comes second with 96 spinouts from 4 unicorns and Paris third with 70 spinouts from ten fintech unicorns.
London dominating the rankings comes despite recent talk it could lose its tech hub crown. Last Monday, 500 entrepreneurs told the UK government that increases to capital gains tax currently being considered could “jeopardise” the country’s tech sector.
Accel’s Bocchio says it’s too soon to write off the UK, citing its history as a global financial centre and its heritage of talent.
“I wouldn’t go too much into thinking that London is going to lose all of this all of a sudden,” he says. “The reality is that those networks are quite powerful.”
Read the orginal article: https://sifted.eu/articles/klarna-revolut-founder-factory-news/
