We wrote about Klarna firing ~ 700 employees (1% of the company) a few weeks ago. This week the layoffs expanded over the whole Fintech scene, and especially crypto:

There are many signs of a downturn at the moment. Last week, the US Federal Reserve raised rates by 0,75 percentage points, the largest interest rate jump since 1994. In Sweden, tech companies are reporting a sudden investor shortage.

Klarna is, according to Wall Street Journal, seeking a capital raise at a much lower valuation than in the previous capital round. The valuation has halved in the last month alone. The funding seems to dry up, and many fintechs are at risk. Especially Neobanks might have a hard time ahead of them: According Simon-Kucher, only 5 percent of challenger banks are currently able to turn a profit. Out of the 25 biggest challenger banks, only two were able to reach profitability.

Sifted speculates which fintechs are likely to be acquired in the current downturn. In the Nordic countries, we can already see some movements in banks focusing on their core market: In Denmark, Jyske Bank is confirming that they are negotiating to buy Handelsbanken’s Danish activities. Meanwhile, in Norway, Sparebank 1 SR-Bank takes over Swedbanks corporate customer portfolio of approximately NOK 5.6 billion.

However, Stripe, one of the most highly valued startups, is undaunted by a looming recession. John Collison, co-founder, and president of Stripe, elaborates: “People are more focused on cost in a recession. So as a result internet retailers actually have an advantage versus offline retailers because of that reduced cost”. Stripe, therefore, believes there still is a lot of room to expand. Collison says fintechs now have the opportunity to “put together a different pitch based on lowering companies’ cost bases” and “There are lots of opportunities if companies position themselves smartly.”

Speaking of position themselves smartly: Stripe just launched Stripe App Marketplace, a payment orchestration solution that allows users to integrate tools like Mailchimp, Xero, Docusign, and Dropbox to create and manage everyday business activities.

But it’s not just doom and gloom all around: The accounting challenger Fiken is one of the few Fintech companies in Norway that delivers solid profits yearly. Now the company spends some of the money on investing in its fintech colleague Folio, which now raises 50 million NOK to integrate banking and accounting to a real-time level.

Folio recently won the Honorary Award from IxDA 2022 and was praised by the award jury for creating a comprehensive and almost frictionless service for entrepreneurs. Earlier in June, they held a meetup explaining how they focus on their target audience when building, and not on competitors, and how they keep the product sharp and not broad. If you find that interesting, you can see the recording here.

Have you ever asked yourself the question:

How do I pick nice-looking colors covering broad use cases for categorical data while meeting accessibility goals?

Well, if you have, I have the perfect plan for your next half hour digging down to color theories, algorithms, and many lovely examples.

Remember, if you’re enjoying this content, please do tell all your (fintech) friends to hit the subscribe button! If you have some feedback, you can always just hit reply!

Marius Hauken, partner Stacc X