A mere eight months after its public launch, Square has joined the big leagues. The company announced Wednesday that it has secured an impressive $100 million Series C round led by Kleiner Perkins, with participation from Tiger Global Management. And to cap things off, Kleiner Perkins’ own Mary Meeker—former Internet stock analyst—will be joining the company’s board of directors.
The new funding effectively quadruples the company’s valuation to $1 billion from $240 million, following its last round. The new funding brings the company’s total raised to $137.5 million.
Square has been adding some high-profile names to its board of directors, not the least of which is former Chief Economic Advisor to President Obama, Larry Summers. Summers, who is also the former President of Harvard, joins Vinod Khosla on the board of directors.
Square’s line-up of investors has been equally impressive, including such high-profile names as Ron Conway, Esther Dyson, Marissa Mayer, Dennis Crowley, Kevin Rose, and more.
But can Square stand up to the new influx of mobile payment solutions from the likes of Google, Intuit, and PayPal? It’s growing at a break-neck pace, processing $4 million in mobile payments per day, which is double the $2 million per day it was processing only two months ago. And Square has added a number of handy new apps to its solution, such as Square Register, which allows small businesses to turn their iPads into a fully functional registers for cash and credit card payments. The app differs from the regular Square service by allowing businesses to track inventory, sales patterns, publish menus and specials, and more.
But as a service that is still dependent on credit cards, can it face down the rise of the digital wallet? A horde of competitors are now crowding the market to offer their own digital wallet solutions, which erase the credit card hassle altogether. Google Wallet, for example, could very well be the most effortless mobile payment solution on the market, requiring no credit cards or logins. Like having an ATM in your smartphone, the digital wallet requires only a one-time banking information input, a PIN, and a sensor. When the user wants to pay, he/she enters the PIN and simply taps the phone to the merchant’s sensor, and the transaction is instantly completed.
Square is attempting a similar mobile payment solution that would almost do away with credit cards—“almost” being the operative word. The Square Card Case would allow shoppers to pay at a participating merchant’s establishment by simply touching a tab in the app. The problem, however, is the process is somewhat complicated and requires the user to make an initial payment via credit card in order to set up the mobile payment feature. The user would first have to pay with credit card, and then wait for the merchant to text a receipt, which contains the code to set up an automatic mobile payment feature. Certainly not as smooth as simply waving your phone over a sensor, but it’s a start.
Mary Meeker is confident in Square’s technology and team. "Square has a great product with extensibility which we believe has the potential to have a lasting impact on how people make payments," Meeker said in a statement. "Square's product is fast, easy and fun for both consumers and vendors; a small business can be up and running within minutes."
There’s no arguing that Square has blazed a mobile payments trail, and with the innovative minds of CEO Jack Dorsey, COO Keith Rabois, and those of the influential members of the board of directors all working together, there’s no doubt the company will be able to "square off" with its competitors.
Image source: Squareup.com