Klarna is using AI to cut its personnel costs — and it’s working

Top News

• ServiceTitan lists, leaps: Shares of ServiceTitan lept this week after it priced and executed a much-awaited IPO. Alex thinks the company’s strong IPO pricing of $71 per share, above even raised targets, could help more companies pull the trigger on a listing in early 2025. But no matter what knock-on effects its IPO has, ServiceTitan’s early trading has seen its worth rise to around $100 per share, giving it a near-decacorn valuation.

• Today in mega-rounds: A startup wants to use learning from worm brains to build new AI systems. It just landed a quarter billion dollars. Another startup just raised a $100 million round to find minerals in space. While we often discuss SaaS companies building products for specific market niches — see the above item — it’s fun to see large sums go to projects that are a bit less ‘figured out’ than enterprise software.

• Klarna slowed hiring thanks to AI: What happens if you mostly stop hiring and bend your workforce to juicing productivity via AI tooling? IIn Klarna's case, the result has been a gradual reduction in staff as employees leave and are not replaced. The experiment has led the Swedish, by now, pay later company to say goodbye to nearly a quarter of its staff ahead of an expected IPO next year. (This is a theme that Jason and Alex have explored extensively, so it’s good to see such a concrete example in the news.)

TWiST500

Normally, I’d use our TWiST500 column inches to riff on one of our resident unicorns doing something interesting, but Klarna’s news had to go in the news section because there’s so much going on elsewhere on the list.

Recall that Anthropic, OpenAI, and xAI are all TWiST500 companies. They meet the brief of ‘potentially world-bending outcomes’ while not being startups in the sense that we’re accustomed to seeing. Most startups don’t raise so many billions so quickly, for one.

But all that money is being put to use. Despite Google’s attempts to flood the zone with Gemini news this week, Anthropic did cut through somewhat by rolling out its “Claude 3.5 Haiku model to all [its] users through the Claude chatbot on the web and mobile apps,” VentureBeat reports.

And OpenAI is not only in the midst of its multi-day shipping event, but made news this week as well by releasing more information regarding its current legal dustup with xAI’s founder and former backer. Apart from swaying public opinion, it’s not clear what OpenAI’s goal was with the non-feature drop, but, hey, here we are.

More useful news for us is that OpenAI’s rundown of the first seven of its twelve announcements can be found here if you want to read along. Oh, and on the podcast today, you might catch yet another TWiST500. See you there! — Alex

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