Klarna the buy now pay later platform is famous for many things. It sells a lot of shoes (for merchant partners) to mostly young consumers. It also is well-known for burning through a lot of cash in its quest to become a giant in payments, fintech, BNPL, and so on.
This quest should reach a crescendo sometime this year when Klarna launches its widely anticipated IPO.
And as many companies do on the road to an IPO, Klarna is trying to clear up its balance sheet and demonstrate that it knows how to do more than just grow.
Klarna wants the world (i.e., investors) also to know that it can cut costs, operate efficiently, and turn a profit. Oh, plus that it knows how to implement AI in service of the above.
Many of these imperatives for Klarna now seem to have converged.
Klarna announced this week that it is squeezing a lot of efficiency out of its customer support chatbot. The bot is built on OpenAI’s ChatGPT, launched last year. Klarna rolled out the bot globally a month ago.
Klarna Looks for Pre-IPO Revenue Diversification via Subscriptions
It started as a shopping assistant that helped consumers find products and conduct “smooth shopping”. The bot has evolved into an agent that handles refunds, cancellations, and dispute resolution.
Did Klarna train the bot to know it’s a bad idea to tell someone to “calm down”?
A Busy Bot
According to the fintech, the bot has been busy since it was introduced to the public. For example, it now handles two-thirds of Klarna’s monthly customer service contacts.
And Klarna says the bot has created efficiencies that will deliver $40 million to its bottom line this year. Not a bad flex in an IPO year, assuming it happens.
However, it was one line from its announcement this week that generated the most press attention.
“It is doing the equivalent work of 700 full-time agents.”
What made this statement so attention-worthy is that Klarna laid off about the same number of people in 2022.
So is this an example of the two-sided coin that is AI? It seems to be.
On the one hand, AI is delivering the kind of efficiency that investors are going to become accustomed to.
But a big part of this efficiency comes in human form. Or the absence of humans with their salaries, benefits, and PTO requests.
Is this the dreaded robot uprising? Of course not. But Klarna’s apparent runaway success with the bot is evidence of AI’s ability to deliver on our hopes as well as our fears.
