Deep | Klarna’s Free $9B Option on Google

On Friday 26th June Swedish courts will render their verdict on a litigation amount with a face value in excess of Klarna's entire market cap

[Post publication note: the verdict date has now been rescheduled to July 1st]

In late 2014, a newly hired CFO sat down to build his first budget for a Swedish price comparison company called PriceRunner.

The Swedish business looked fine, with decent margins and steady traffic.

He then turned his attention to the UK and, in his words to a Stockholm court 11 years later: “the numbers made ZERO sense”. At the time, the UK was the largest and fastest growing e-commerce market in Europe – yet PriceRunner UK was flatlining on life support.

So he went through the historical data. PriceRunner had installed Google Analytics in the Spring of 2012. Traffic had climbed throughout that year and into the Christmas shopping peak – perfectly normal seasonality patterns so far, right until all the metrics suddenly dropped off a cliff:

“In the middle of December, 80% of all organic traffic just vanished overnight. It looked like an execution. Nothing had changed – the product, the consumer, nothing..…