Compare / Klarna vs Pinterest
AT A GLANCE
FUNDING HISTORY
Klarna
BUSINESS MODEL
Klarna
Klarna makes money from merchant fees and consumer interest. Merchants pay Klarna 3-6% of each transaction — they're willing to pay because Klarna increases conversion rates by 30%+ and average order values by 45%.
On "Pay in 4" (interest-free installments), Klarna makes money purely from merchant fees. On longer financing (6-36 months), Klarna charges consumers interest up to 25% APR.
Klarna also earns revenue from its shopping app (affiliate commissions when users discover and buy from merchants), and from its Klarna Card.
Pinterest makes money through advertising — specifically through "Promoted Pins" that look nearly identical to organic content. This is the magic of Pinterest's business model: ads don't interrupt the experience because the experience IS discovering products and ideas.
A promoted pin for a kitchen knife set appears right alongside organic pins of kitchen designs. The user doesn't distinguish between "ad" and "content" because both serve the same purpose.
Shopping ads are the fastest-growing segment. Brands upload their product catalogs, Pinterest matches products to user searches and boards, and users can buy directly through the platform or click through to the retailer's site.
Pinterest gets paid per click or per thousand impressions.
Revenue reached $3.65 billion in 2024, up from $3.05 billion the year before, and 2024 was its first genuinely profitable year. Average revenue per user is growing but still well below Meta's — the upside is enormous if Pinterest can close that gap.
HOW THEY STARTED
Klarna
Sebastian Siemiatkowski, Niklas Adalberth, and Victor Jacobsson were students at the Stockholm School of Economics. In 2005, they entered a startup competition with an idea: let people buy things online and pay later.
At the time, online shopping was still new and most people were terrified of entering their credit card details on the internet. The idea was simple — Klarna would pay the merchant immediately, and the customer would get an invoice with 14-30 days to pay.
The competition judges hated it. The idea was dismissed as financially irresponsible and the team didn't win.
But Siemiatkowski pressed on. Swedish e-commerce was growing fast and merchants were desperate for any way to reduce cart abandonment.
Klarna's "pay after delivery" model was a hit because it shifted the risk — customers could receive the product, try it on, and only pay for what they kept.
The first customers were Swedish e-commerce merchants selling fashion and home goods. Klarna handled the invoicing, fraud detection, and collections.
Merchants saw conversion rates jump because customers were more willing to buy when they didn't have to pay immediately.
Ben Silbermann was a former Google ad operations employee who quit in 2008 to build apps. His first attempt was an iPhone app called Tote — essentially a mobile catalog that let women browse and bookmark products from fashion retailers.
Nobody downloaded it. But Silbermann noticed something in the data: users were saving products obsessively.
The collecting behavior was more interesting than the shopping behavior.
He teamed up with Paul Sciarra, a classmate from Yale, and Evan Sharp, a designer who was studying architecture at Columbia. Together they built Pinterest — a visual bookmarking tool that let people "pin" images from around the internet to organized boards.
Think of it as a digital mood board that anyone could make.
Pinterest launched as an invite-only beta in March 2010. Growth was painfully slow at first.
Silbermann personally wrote to the first 5,000 users, giving them his phone number and asking what they wanted. The early community was overwhelmingly women interested in home decor, fashion, recipes, and DIY projects.
By 2011, Time magazine named Pinterest one of the 50 best websites. By 2012, it was the fastest site in history to reach 10 million unique monthly visitors.
HOW THEY GREW
Klarna
Klarna grew by being embedded at checkout. The strategy was to sign up the biggest online retailers and become a payment option alongside Visa and PayPal.
Once Klarna was at checkout, consumers discovered it organically. The "Pay in 4" button became ubiquitous across fashion, electronics, and home goods retailers.
The Klarna app became a growth engine beyond checkout. By building a shopping app where users could browse products, discover deals, and track deliveries, Klarna turned from a payment method into a shopping destination.
The app has 35+ million monthly active users who start their shopping journey inside Klarna before even visiting a retailer.
International expansion was aggressive. Starting in Sweden, Klarna rolled out across Europe, then into the US, UK, and Australia.
The US became the biggest growth market — American consumers were especially receptive to Pay in 4 as an alternative to credit cards. By 2023, Klarna had 34 million US users.
Pinterest grew organically through women sharing boards with each other. The weddings use case was the killer app — brides-to-be would create boards for dresses, venues, flowers, and invitations, then share them with their wedding parties.
That viral loop drove millions of signups.
SEO is the secret weapon. Pinterest pages rank extremely well in Google Image Search.
Someone searching "modern living room ideas" often sees Pinterest results on page one. That drives a large stream of organic traffic from people who were not looking for Pinterest at all.
Unlike other social platforms, which compete with Google for attention, Pinterest quietly benefits from it.
The shopping pivot has been the growth unlock. Under CEO Bill Ready (former Google and PayPal executive who took over in 2022), Pinterest aggressively invested in shopping features — catalog integrations, buyable pins, merchant verification, and visual search for products.
The thesis: Pinterest users are already in a shopping mindset, so removing friction between "I like this" and "I bought this" is the straightforward path to revenue growth.
THE HARD PART
Klarna
The valuation collapse was humiliating. Klarna raised at a $46 billion valuation from SoftBank in 2021.
One year later, they raised a down round at $6.7 billion — an 85% haircut. It was the most dramatic valuation drop in fintech history.
Employee stock options were underwater. Siemiatkowski had to lay off 10% of the workforce.
The entire BNPL category went from hot to radioactive in months.
Credit losses are the existential risk. Klarna is lending money to consumers who want to buy things they can't afford to pay for right now.
When the economy slows, defaults rise. Klarna's credit losses ran to roughly $600 million in 2022.
The company had to tighten underwriting significantly and pull back from riskier markets. The tension between growth (approve more loans) and profitability (reject risky borrowers) defines every quarter.
The IPO in 2025 was a comeback story but with caveats. Klarna went public at $15 billion — a major recovery from the $6.7 billion trough but still less than a third of its 2021 peak.
The company finally turned profitable by slashing costs with AI (replacing hundreds of customer service agents with AI chatbots) and tightening credit standards. But investors remain cautious about the BNPL model's long-term sustainability.
Pinterest's demographics are both an advantage and a limitation. The platform skews heavily female (over 60% women) and is strongest in home, fashion, food, and weddings.
Expanding beyond these categories to attract male users, younger demographics, and different use cases has been slow.
Competition for ad dollars is fierce. Pinterest competes with Meta, Google, TikTok, and Amazon for advertising budgets.
Most advertisers allocate the bulk of their spend to Meta and Google first, then consider others. Pinterest needs to prove its return on ad spend is competitive to win larger budget allocations.
Creator economy is underdeveloped. While Instagram, TikTok, and YouTube have massive creator ecosystems with monetization tools, Pinterest has historically been about content discovery, not content creation.
Users pin other people's content — the original creators often don't even know their work is on Pinterest. Building a creator program and driving original content creation on the platform has been a recent focus but lags far behind competitors.
THE PRODUCTS
Klarna
Pay in 4 is the signature product — split any purchase into four interest-free payments over six weeks. Pay in 30 lets customers receive the product first and pay within 30 days.
Financing offers longer-term payment plans with interest for larger purchases. The Klarna App is a shopping destination — browse deals, track orders, manage payments, and earn cashback.
The Klarna Card is a physical Visa card that lets users Pay in 4 anywhere. Klarna Creator is a platform for influencers to earn commissions sharing products.
Klarna AI is their customer service chatbot that handles two-thirds of support queries.
Pinterest Home Feed — the core discovery surface showing personalized pins based on user interests, boards, and search history. Pinterest Lens — visual search technology that lets users take a photo of any object and find similar items to buy on Pinterest.
Pinterest Shopping — integrated e-commerce allowing users to browse and purchase products directly from pins linked to retailer catalogs. Pinterest Boards — the organizing system where users save and categorize pins into collections, used for wedding planning, home renovation, recipes, fashion, and more.
Pinterest Shuffles — a collage-making app for Gen Z users to create aesthetic mood boards, driving younger user adoption.
WHO BACKED THEM
Klarna
Sequoia Capital, SoftBank, Silver Lake, GIC, Atomico, Commonwealth Bank of Australia, Heartland
Bessemer Venture Partners, FirstMark Capital, and Andreessen Horowitz were early investors. Fidelity and Valiant Capital participated in later rounds.
Rakuten invested strategically. The April 2019 IPO raised $1.4 billion at a $12.7 billion valuation.
Elliott Management, the activist investor, took a large stake in 2022 and pushed for operational improvements that contributed to the company's path to profitability.