Report: Square's latest financing may value it at $4B
Square is reportedly raising a new round of financing that values the mobile payment startup at $4 billion--roughly four times what it was worth less than a year ago.
Citing multiple sources familiar with the situation, AllThingsD reports Square is currently in talks with investors. Square CEO Jack Dorsey and COO Keith Rabois have been spotted in Boston and Baltimore, both home to multiple institutional investors, and asset management firm Legg Mason has confirmed it is "looking into" the company. A Square spokesperson declined to comment.
Square has raised about $137 million from investors including Kleiner Perkins Caufield & Byers, Tiger Global Management, Sequoia Capital and Khosla Ventures. Its last round, completed in June 2011, raked in $100 million, vaulting the firm's valuation to more than $1 billion.
First introduced for Apple's (NASDAQ:AAPL) iPhone in late 2009, Square enables small businesses and other users to accept credit and debit purchases by swiping cards through a small dongle that plugs into the device's audio jack. Square also offers mobile applications like Register, optimized for mom-and-pop businesses armed with Apple's iPad tablet, as well as the hands-free Pay with Square, which allows consumers to make purchases and settle tabs without ever removing their mobile device from their pocket or purse.
Square charges a flat fee of 2.75 percent on all transactions and promises users no contracts, monthly fees or hidden costs. More than a million merchants nationwide now accept credit and debit cards via Square; Dorsey recently announced that company is processing $11 million in transactions each day, almost triple the $4 million per day quoted in July 2011.
Square faces competition from a number of rival mobile payment solutions including the fledgling PayPal Here, unveiled last month. A small, triangle-shaped dongle that attaches to a phone or tablet's audio jack in the same fashion as Square's own payment processing reader, PayPal Here charges merchants 2.7 percent per credit card or PayPal transaction, a .05 percent savings over Square. PayPal Here signed up an average of 1,000 users per hour during its first day of availability.
- read this AllThingsD article
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