Klarna, the most valuable fintech unicorn in Europe, told employees yesterday that it was laying off 10%—or around 700—of its employees this week.

“When we set our business plans for 2022 in the autumn of last year, it was a very different world than the one we are in today,” Klarna CEO and co-founder Sebastian Siemiatkowski told employees yesterday in a pre-recorded video whose transcript the company later posted online. Siemiatkowski noted that—due to the war in Ukraine, a shift in consumer sentiment, steep inflation, stock market volatility, and a likely recession—Klarna was restructuring and cutting 10% of its staff so that it could still meet its goals.

Investors have been anticipating a slew of layoffs at venture-backed private companies—but actual mass layoffs have been few and far between thus far. There was Latch at the end of last week, which laid off 28% of its full-time staff—or around 130 people—to speed up its efforts in generating cash flow and becoming profitable. Or Outside, the Boulder-based digital outdoor athletics publication, which said it was letting go of 15% of its staffers earlier this month.

Just a year ago, Stockholm-based Klarna seemed untouchable. It is a venture capital darling—having raised nearly $4 billion in venture capital dollars from backers like Sequoia Capital and SoftBank, and becoming the highest valued unicorn based out of Europe. It’s been rapidly scaling, launching a Chrome browser extension and adding its Klarna credit card to new markets. 

But even Klarna isn’t immune to what investors fear will be a long-lasting downturn.

U.S.-based competitor Affirm has taken a nosedive in the public markets—down nearly 75% from the beginning of January. That’s not great for Klarna, which had been contemplating an IPO, but last fall decided to wait some of the volatility out on the sidelines. The BNPL bank appears to be struggling to raise new capital at the terms it had managed early on in the pandemic. The Wall Street Journal reported that Klarna was out fundraising again—this time at a $30 billion valuation (people familiar with the matter told the Financial Times this is speculation, but confirmed the valuation will be lower than the $45.6 billion the company notched in 2021). There’s also the ongoing Consumer Financial Protection Bureau (CFPB) probe into BNPL companies, announced late last year, over whether consumers are racking up more data than they can handle.

With no major BNPL companies profitable yet, analysts are concerned over how consumer fintech companies will fare if there’s a recession—as delinquencies and defaults may threaten their existing risk management models. As Robert Le, a senior emerging technology analyst at PitchBook, points out: Affirm’s delinquencies rose to 6.3% in the first quarter of this year—up from 4% in the second quarter of 2021.

Here’s a concerning data point: Consumer debt bumped up $52 billion in March, a historic increase. As noted in New York Magazine, 91% of consumer loans made in California in 2020 were BNPL loans, and more than 40% of Gen-Z consumers are on track to have used BNPL by the end of 2022. All is well and dandy—as long as people pay it back.

With groceries, gas, and just about everything else getting more expensive, let’s hope people can and do—and that these aren’t the first dominoes in what will be a series of layoffs and downrounds.

It’s that time of year… When Walmart is, once again, named No. 1 on our annual and historic Fortune 500 list—the 68th edition of which was published yesterday. Despite rising inflation, the ongoing supply chain crisis, and the second year of the COVID-19 pandemic, the 500 corporations on this year’s list generated a record $16.1 trillion in revenue and $1.8 trillion in profits. Check out who made the list, who didn’t, where they’re located, and a complete history of the rankings. 

See you tomorrow,

Jessica Mathews
Twitter: @jessicakmathews
Email: jessica.mathews@fortune.com
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Jackson Fordyce curated the deals section of today’s newsletter.

VENTURE DEALS

- Xendit, a Jakarta-based payments infrastructure platform for Southeast Asia, raised $300 million in Series D funding. Coatue and Insight Partners led the round and were joined by investors including Accel, Tiger Global, Kleiner Perkins, EV Growth, Amasia, Intudo, and Goat Capital.

- Belong, a San Mateo, Calif.-based property management platform for the renting process, raised $50 million in Series B funding led by Fifth Wall’s Dan Wenhold and was joined by investors including Battery Ventures, GGV Capital, and a16z. 

- Stoa USA, the Phoenix-based company that launched FlipOS, a platform for single-family home investors, raised $50 million in funding from Zeev Ventures. 

- Meter, a San Francisco-based internet infrastructure provider for businesses, raised $38 million in Series B funding. Sequoia Capital and Lachy Groom led the round and were joined by investors including Meraki co-founders John Bicket and Sanjit Biswas, Diane Greene, Tobi Lütke, WndrCo, and other angels. 

- clicOH, a Mexico City-based shipping provider for businesses in Latin America, raised $25 million in Series A funding led by Tiger Global and was joined by investors including JAM Fund, Flexport, FundersClub and Vast VC.

- Everstream Analytics, a San Marcos, Calif.-based supply chain insights and risk analytics company, raised $24 million in Series A funding from investors including Morgan Stanley Investment Management, Columbia Capital, StepStone Group, and DHL.  

- Homethrive, a Northbrook, Ill.-based care management and assisted living health care company, raised an additional $20 million in Series B funding led by Human Capital and was joined by investors including 7wireVentures and Pitango HealthTech. 

- Parallel Learning, a New York-based digital health platform for students with learning and thinking differences, raised $20 million in Series A funding led by Tiger Global and was joined by investors including Obvious Ventures, Barry Sternlich’s JAWS, and Vine Ventures. 

- EXO Freight, a Royal Oak, Mich.-based digital freight marketplace for open deck shipping, raised $15 million in Series A funding led by Left Lane Capital and was joined by investors including Detroit Venture Partners, 1984.vc, Y Combinator, I2BF Global Investments, and Lancaster Investments. 

- Lassie, a Stockholm-based pet insurance provider, raised €11 million ($11.74 million) in Series A funding led by Felix Capital and was joined by investors including Inventure, Passion Capital, and other angels. 

- Oviva Therapeutics, a New York-based women's health biotech company, raised $11.5 million in seed funding from Cambrian BioPharma. 

- Quartic.AI, a San Jose-based A.I. platform for autonomous manufacturing, raised $4.5 million in funding from ZS. 

- COAT, a London-based paint company, raised £3.5 million ($4.4 million) in seed funding from investors including Pembroke VCT, Seedrs, and Channel 4 Ventures. 

- Foodsteps, a London-based food sustainability platform, raised $4.1 million in seed funding led by Octopus Ventures and was joined by investors including Metaplanet, Ascension, and the Conduit EIS Impact Fund. 

- Polygon, a Santa Monica, Calif.-based learning differences services company focused on dyslexia, ADHD, and other learning differences, raised $3.6 million in funding led by Spark Capital.

- ZincSearch, a San Francisco-based search engine technology company, raised $3.6 million in seed funding led by Nexus Venture Partners and was joined by investors including Dell Technologies Capital, Secure Octane, Cardinia Ventures, and other angels. 

- Cyscale, a Cluj-Napoca, Romania-based cloud security analysis company, raised €3 million ($3.2 million) in funding led by Notion Capital and was joined by investors including Seedcamp, GapMinder, Fiberplane and NP-Hard Ventures founder Micha Hernandez van Leuffen, and Console.dev and Server Density founder David Mytton. 

- Peek, a New York-based property leasing platform, raised $2.5 million in seed funding led by GFA Venture Partners.

PRIVATE EQUITY

- Redbird Capital Partners, agreed to acquire AC Milan, a Milan-based soccer club, for €1.3 billion ($1.39 billion) from Elliott Management Corp., according to Bloomberg. Elliott will keep a minority stake in the company. 

- Centre Partners acquired Captain D's Seafood, a Nashville-based seafood-themed quick service restaurant group. Financial terms were not disclosed.

- L Catterton agreed to acquire a minority stake in Crediclub, a Monterey, Mexico-based lending platform. Financial terms were not disclosed. 

OTHER

- Innovia agreed to acquire Entasis Therapeutics, a Waltham, Mass.-based late-stage clinical biopharmaceutical company focused on antibacterial products. A deal values Entasis at $113 million. 

- American Tire Distributors agreed to acquire Tires Now, the wholesale tire distribution assets of Monro, a Rochestery, N.Y.-based automotive service and tire provider. Financial terms were not disclosed. 

- Arcadia acquired Urjanet, an Atlanta-based utility data provider. Financial terms were not disclosed. 

- BDT & Company acquired a minority stake in Pendulum, a Los Angeles-based investment and advisory platform. Financial terms were not disclosed. 

FUNDS + FUNDS OF FUNDS

- Crane Venture Partners, a London-based venture capital firm, raised $140 million for a second fund focused on early-stage founders building software platforms.

PEOPLE

- Linse Capital, a San Juan-based growth equity firm, hired Rob Kaufman as principal and head of investor relations. Formerly, he was with FTV Capital.