This Klarna founder got out early – and did not become a billionaire

Niklas Adalberth was one of the founders of the fintech company Klarna, which was valued at $ 31 billion in a financing round four weeks ago.

In contrast to his co-founders, who have become billionaires as a result, Adalberth got out in 2015. He founded the Norrsken Foundation, a non-profit organization that supports social entrepreneurship.

He has not regretted the move so far, says Adalberth. His only compromise in life is that he has become a vegetarian.

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Four weeks ago, Swedish fintech darling Klarna raised $ 1 billion in a financing round and was valued at $ 31 billion. Two of its founders – CEO Sebastian Siemiatkowski and the former CFO Victor Jacobsson – brought this out loud „Forbes“ a Assets of more than $ 2 billion each. Klarna was founded in 2005 and enables consumers to pay for items in installments.

Niklas Adalberth, the third co-founder, could also have become a billionaire. When he left in 2015, he owned 8 percent of the company. That would be worth almost $ 2.5 billion today. But Adalberth has sold its stake over the years to fund philanthropic projects and its impact investing. His remaining 0.75 percent stake is currently $ 230 million.

Adalberth, 39, had mixed feelings when he first heard about the big round. He was happy for his colleagues, but also wondered how much more he could have raised for his non-profit organization if he had kept his shares longer. Since Adalberth’s departure as Deputy CEO, Klarna has achieved an increase in value of almost 1,300 percent.

But he doesn’t regret his decision. Adalberth has invested 140 million euros (about 165 million dollars) in the Norrsken Foundation, a charitable foundation he founded in 2016. His aim is to inspire European entrepreneurs to share more while they are still alive and to invest in companies that address social issues such as climate change and mental health.

“It is said that compound interest is the eighth wonder of the world. I think the same goes for the effect. The earlier you start to make a difference, the sooner it can have a snowball effect for the future, ”said Adalberth from his home in Stockholm. “Should I have stayed with Klarna to try to grow my fortune? Or did it actually make sense to spend my money now where the world needs it most? The decision is pretty easy. “

‘I have created something net positive‘

Adalberth was 24 when he founded Klarna with two friends, Siemiatkowski and Jacobsson. “When I started with Klarna, I had this belief that money correlated with happiness,” he said. “In that sense, it was very selfish from the start.”

In 2012, the trio was able to sell shares in Klarna for the first time after a fundraising round. Overnight, Adalberth had $ 10 million in his bank account. He decided to celebrate by stopping in Las Vegas on the flight from Stockholm to San Francisco for a conference. He treated himself to a business class flight, a hotel suite with a view of the Strip, good food and a shopping spree with a designer.

“But when I was living this dream, I started to get this bad feeling: ‘Hey, I can’t really taste the difference between this wine and the s ***** wine I have at home”, he said. “‘I don’t sleep better in this panorama suite either – compared to my Ikea bed at home.'”

He added, “I started looking at my shopping bags and they were looking at me like they had some kind of message. And that message was, ‘You are so pathetic. How can you believe that all of this consumption or stuff could in some way buy happiness or purpose? ‘”

After the trip, he began therapy and withdrew. He said that he has started to reset his priorities. That led him to his decision to leave Klarna in 2015. “I think Klarna does a lot of great things. But we also enable people to pay for purchases in installments. Is that really what the world needs? Buying things that they may not need at a certain interest rate that they will pay off in the future? ”He said.

“I’m so lucky in life and more money doesn’t make sense. And I really want to be able to look at myself in the mirror and see that I’ve created something net positive, ”he added.

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‘Maybe we can get the top talent to tackle real problems‘

A year after leaving Klarna, Adalberth set up the Norrsken Foundation – a nonprofit “Tech for Good” foundation with an early stage venture capital arm – with $ 20 million from the sale of some of his shares. He brought a former Klarna colleague, Erik Engellau-Nilsson, on board as CEO of the foundation. Her motto is: “Get good s— done.”

Adalberth chose a chic 2,400 square meter office in downtown Stockholm as the headquarters of Norrsken. When he realized that it was way too big for his employees, he turned the Norrsken House into a subsidized workspace for people who work in impact-oriented companies. He thought that the hip startup hub with a meditation room, event space and photo studio could give social entrepreneurship a certain seal of approval. Today Norrsken has 450 employees.

“It’s pretty popular now in Sweden to try to become a unicorn founder. A lot of the media revolves around the most successful entrepreneurs, but also Instagram celebrities and sports stars, ”he said. “What I’m trying to do with the foundation is to see whether we can turn impact entrepreneurs into the next role models. Maybe we can get the top talent to tackle real problems and not build the next addicting computer game or another online casino. “

The foundation is 100 percent financed by Adalberth and supports initiatives with little chance of return but high social impact. She hopes to break even with this over time.

The only compromise is vegetarianism

In Norrsken’s venture capital division, which has external investors, Adalberth wants to prove that impact investing can generate both financial returns and social benefits. Norrsken has his “Blueprint”, Documents such as term sheet templates and portfolio strategy criteria, posted online to inspire others.

Most of the 21 portfolio companies are located in Sweden and are dedicated to protecting the environment. The Karma mobile app, for example, reduces food waste by connecting customers with retailers who are oversupplied. That saves four million meals. Such projects are just the beginning, as Norrsken closed its € 125 million fund for early-stage startups last month.

If one of these investments is financially successful, the profit will not go to Adalberth. Its carried interest – its share of future profits if a portfolio company goes public or is taken over – goes back to the foundation in accordance with the fund terms and conditions. By renouncing this stake and reducing its Klarna stake, Adalberth missed a decent fortune. But he said the only compromise he really made was to become a vegetarian. “I love to eat meat. It’s the only area in my life where I actually give up something, ”he said. “But apart from that, I’m now living a dream life.”

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This article was translated from English by Steffen Bosse. You can find the original here.

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