Read the following article (abridged) from the Financial Times and estimate the valuation loss suffered by investors who participated in the funding round led by Softbank one year ago.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
icon
Related questions
Question

Please help me answers the question 

Read the following article (abridged) from the Financial Times and estimate the valuation loss suffered by investors who participated in the funding round led by Softbank one year ago.

Klarna AB
Klarna's valuation crashes to under $7bn in tough funding round
Sequoia's Michael Moritz says investors are in their bunkers' and prices will recover
Klarna.
K.
Klarna
Klarna was once Europe's most valuable private fintech company © Bloomberg
Siddharth Venkataramakrishnan in London JULY 11 2022
Klarna, once Europe's most valuable private tech company, has had its pricetag slashed from
$46bn to $6.7bn at a difficult fundraising that highlights the crash in many tech valuations.
Michael Moritz, chair of Klarna and a partner at investor Sequoia, blamed "investors suddenly
voting in the opposite manner to the way they voted for the past few years". He predicted that
"after investors emerge from their bunkers, the stocks of Klarna and other first-rate companies will
receive the attention they deserve”.
The $800mn fundraising round, announced on Monday, featured new investors including
Mubadala, the sovereign wealth fund of the United Arab Emirates, and the Canada Pension Plan
Investment Board in addition to existing investors such as Sequoia and Commonwealth Bank of
Australia.
Just over a year ago, Klarna was valued at $46bn after a $639mn funding round led by Japan's
SoftBank, the investment group behind a disastrous bet in office-sharing group WeWork. The new
"pre-money" valuation, excluding the new cash, is only $5.9bn.
Transcribed Image Text:Klarna AB Klarna's valuation crashes to under $7bn in tough funding round Sequoia's Michael Moritz says investors are in their bunkers' and prices will recover Klarna. K. Klarna Klarna was once Europe's most valuable private fintech company © Bloomberg Siddharth Venkataramakrishnan in London JULY 11 2022 Klarna, once Europe's most valuable private tech company, has had its pricetag slashed from $46bn to $6.7bn at a difficult fundraising that highlights the crash in many tech valuations. Michael Moritz, chair of Klarna and a partner at investor Sequoia, blamed "investors suddenly voting in the opposite manner to the way they voted for the past few years". He predicted that "after investors emerge from their bunkers, the stocks of Klarna and other first-rate companies will receive the attention they deserve”. The $800mn fundraising round, announced on Monday, featured new investors including Mubadala, the sovereign wealth fund of the United Arab Emirates, and the Canada Pension Plan Investment Board in addition to existing investors such as Sequoia and Commonwealth Bank of Australia. Just over a year ago, Klarna was valued at $46bn after a $639mn funding round led by Japan's SoftBank, the investment group behind a disastrous bet in office-sharing group WeWork. The new "pre-money" valuation, excluding the new cash, is only $5.9bn.
Expert Solution
steps

Step by step

Solved in 2 steps

Blurred answer
Similar questions
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education