|Headquarters||San Francisco, United States|
|Area served||United States, Canada, and Japan|
|Key people||Jack Dorsey (chief executive officer)
Jim McKelvey (chairman)
Sarah Friar (chief financial officer)
|Industry||Mobile Payments, Point of Sale|
|Products||Register, Order, Market, Cash, Capital, Feedback, Reader, Stand|
|Alexa rank||5,548 (April 2014[update])|
Square, Inc. is a financial services, merchant services aggregator and mobile payments company based in San Francisco, California. The company markets several software and hardware products and services, including Square Register and Square Reader. The company was founded in 2009 by Jack Dorsey and Jim McKelvey and launched its first app and service in 2010.
Square Register allows individuals and merchants in the United States, Canada, and Japan to accept offline debit[discuss] and credit cards on their iOS or Android smartphone or tablet computer. The app supports manually entering the card details or swiping the card through the Square Reader, a small plastic device which plugs into the audio jack of a supported smartphone or tablet and reads the magnetic stripe. On the iPad version of the Square Register app, the interface resembles a traditional cash register.
- 1 History
- 2 Products
- 3 Financials
- 4 Business
- 5 Customer support
- 6 Reception
- 7 Banned transactions
- 8 References
- 9 External links
The original inspiration for Square occurred to Jack Dorsey in 2008 when Jim McKelvey (a St. Louis friend of Dorsey at the time) was unable to complete a $1,000 sale of his glass faucets and fittings because he could not accept credit cards.
The name "Square" refers to the Square card readers which are square in shape. The name also refers to the idiomatic term for settling debts: "squaring up". Several other names were also considered but rejected, including squirrel, stash and wallet. The name Squirrel was in use during a meeting the company had with Apple, wherein Scott Forstall, SVP of iPhone Software, informed Dorsey he should change the name.
The Square Reader was the first product released by Square, and is used to accept credit card payments by connecting to a mobile device's audio jack. Square's original reader consisted of a simple read head directly wired to a 3.5mm audio jack, through which unencrypted, analogue card information was fed to smartphones for amplification and digitization. Square's technology is PCI compliant and Verisign certified.
In April 2011, rival payment company VeriFone claimed that the Square system at the time was insecure, and that a "reasonably-skilled" programmer could write a replacement app which could conceivably use the Square device to skim a credit card and return its details, because the first Square reader did not encrypt track data in hardware. VeriFone posted a demonstration video and sample skimming app to its web site. Dorsey called VeriFone's claims "neither fair nor accurate", noted that the card data could be gathered visually from the card, and said that the claims ignored the fraud protection provided by card issuers.
Square now uses strong encryption on its devices, including SSL and PGP. Its cryptographic keys are at least 2048 bits in length. Card numbers, magnetic stripe data, or security codes are not stored on Square client devices. Square follows the guidelines issued by OWASP.
In July 2014, Square announced a card reader that would accept chip cards, ahead of the October 2015 EMV liability shift. This new reader supports traditional magnetic stripe card transactions as well as chip and signature transactions. 
In June 2015 at the Apple Worldwide Developers Conference, Apple announced Square will release a new Square Reader capable of accepting Apple Pay and other contactless payments. The reader will also be able to accept EMV chip cards.
In June 2013, Square unveiled Square Stand at a press event at Blue Bottle coffee in San Francisco. Square Stand aims to turn the Apple iPad into a more complete point of sale system. It makes use of a larger reader and a rotatable base that allows the stand to be swiveled around. Square Stand took more than a year to develop and the team of around 15 was led by Jesse Dorogusker, a former Apple director of engineering for iPhone, iPod, and iPad accessories at Apple. The Square Stand works with iPad 2, iPad 3rd generation (30-pin connector), and iPad Air (lightning).
Square Register is point of sale software aimed at replacing traditional credit card terminals and cash registers. Square Register combines payment processing with point-of-sale functionality like itemization and inventory management, and integrates with third-party platforms such as Shopventory, Weebly, and Bigcommerce via an App Marketplace.
In October 2013, Square launched Square Cash, which allows person-to-person money transfer over e-mail. The service allows users to send money by drafting an e-mail, including the dollar amount in the subject of the e-mail, and CC'ing Square Cash, initiating a transfer directly to the recipient's debit card.
In May 2014, Square launched Square Capital, which offers business financing to merchants using Square. In contrast with a traditional loan, there is no time limit for a merchant to pay off a Square Capital cash advance. The merchant returns the advance to Square by paying back a percentage of their credit card sales over time.
On August 4, 2014, Square announced the acquisition of Caviar, a startup that delivers meals from high-end restaurants. Caviar uses a fleet of couriers to provide delivery for popular restaurants who do not otherwise deliver. Caviar is currently available in 18 markets in the U.S.
Caviar eventually replaced Square Order, an app which allowed users to make purchases in advance and pick them up at a predetermined time. On March 2015, Square announced that it was shutting down Square Order to focus on other efforts.
In April 2015, Square launched Customer Engagement, a suite of CRM tools which includes email marketing services. These tools allow businesses to target customer audiences with customized or different messages and promotions based on actual (offline) purchase behavior.
Square received angel investment from Marissa Mayer, Edward W Cramer, Kevin Rose, Biz Stone, Dennis Crowley, Shawn Fanning, MC Hammer, and Esther Dyson. Since then, it has raised several additional rounds of funding:
- Series A funding from Khosla Ventures
- Series B funding from Sequoia Capital
- Series C funding from Kleiner Perkins Caufield & Byers
- Series D funding from Citi Ventures, Rizvi Traverse Management, and Starbucks
- Series E funding from Goldman Sachs, Rizvi Traverse Management, and GIC Private Limited
The company's valuation in October 2014 was $6 billion.
Square has been available in the United States since 2010 and became international when the company launched in Canada at the end of 2012. In May 2013, Square announced that its mobile payments service was available in Japan after agreeing to a partnership with Sumitomo Mitsui Card Corporation. The fee for transactions would be 3.25% in Japan.
Square's Board of Directors includes Dorsey, McKelvey, Roelof Botha, Vinod Khosla, Mary Meeker, former US Treasury Secretary Larry Summers, former CFO of Goldman Sachs David Viniar, and businessman and NBA hall-of-famer Earvin Johnson.
As of March 2013, Square provides its magnetic stripe card readers to users for free. Square charges $99 for Square Stand and $29 for its chip-based Square Reader. The Square app is also freely downloadable from the App Store and the Google Play Store.
Square charges a fee of 2.75% on every credit card transaction. Square does not have any additional fees beyond the 2.75% per swipe (or the 3.50% plus $0.15 cost per manually-entered transaction) and there are no monthly fees or set-up costs. Square claims that its costs are, on average, lower than the costs charged by the conventional credit card processors. Square is regarded as a useful app for entrepreneurs, including for example consultants, food truck operators, and traditional retailers.
As of May 2014, Square charges sellers a monthly fee of $10 to use Square Feedback, which provides a private channel of communication between sellers and their buyers using the digital receipt.
Swiped payments are deposited directly into a user's bank account within 1-2 business days. In some instances, Square may withhold payments to its users pending issues related to chargebacks.
At the TechCrunch Disrupt conference in May 2011, Square announced the release of two new apps, Square Card Case (later rebranded as Square Wallet) and Square Register. Square Wallet, before it was removed from the Apple App Store and Google Play Store in 2014, allowed customers to set up a tab and pay for their order by providing their name (or a barcode) using a stored credit, debit, or gift card.
In August 2012, Starbucks announced it would use Square to process transactions with customers who pay via debit or credit card. In February 2014, Whole Foods Market announced it would use Square Register in select stores' sandwich counters, pizzerias and coffee, juice, wine and beer bars.
In July 2013, Square launched Square Market, which allows sellers to create a free online storefront with online payment processing functionality.
Square's support is handled via phone, email, YouTube videos, a Twitter feed and an online help center.
In the media
Business Insider praised the product for its "ease of use, simplicity and elegance". Business Insider favorably compared Jack Dorsey with Steve Jobs for what they call his "entrepreneurial vision and charisma". The Next Web praised Square's website squareup.com for its design and aesthetic appeal. The product was also showcased at Apple's iPad 2 event. GigaOM called the product a disruptive innovation.
It is to be noted that customer feedback is very diverse at the current state with a strong tendency to the negative. Positive reviews especially commend the ease of use and availability to the majority of devices. Most negative complaints emerge from an unsatisfying customer support. The main reason for inquiries originate from suspended accounts with money on the hold due to alleged illegal business which infringes against Square's terms. The website cardpaymentoptions.com states that "[t]he majority of the complaints fall into three areas: virtually nonexistent phone support, misunderstanding and nondisclosure of its former $2,002 card-not-present deposit hold policy, and reports of random fund holding or account deactivation exceeding 30 days with no explanation or communication from Square." On its website it counted over 1200 complaints alone. Other websites add to the picture showing a vast amount of negative to very negative critics and reviews.
In May 2013, Square announced it would no longer allow firearms-related transactions to be performed using its devices or software. The company amended the terms of service for retailers to ban sales of "firearms, firearm parts or hardware, and ammunition; or ... weapons and other devices designed to cause physical injury". The company denied that this move was related to the increased debate over gun control.
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