Exclusive

In Crunch Time, Square Considers Giving Capital to Businesses

Square CEO Jack Dorsey. Credit: TechCrunch.
Square CEO Jack Dorsey. Credit: TechCrunch.

Square is moving further beyond the swipe.

The payments company has begun testing a way to give Square merchants thousands of dollars to help them grow, according to three people familiar with the effort. The early-stage test is part of the startup’s push to diversify beyond processing credit cards for small businesses, a competitive and low-margin business.

Square has also been considering raising another round of funding that would put an initial public offering off beyond 2014, these people say. Earlier this year, Square authorized a tender offer to allow employees to sell some stock at a $5 billion valuation. The company is waiting a bit longer before deciding whether to proceed with another fundraising round, one of these people said. A number of media reports have said Square was considering going public this year.

A Square spokesman declined to comment on future products and fundraising.

The moves come at a crunch time for the five-year-old company.

No subscription? You’re missing out.
Join the high-powered community of tech and business leaders who rely on The Information’s original news and in-depth reporting.
Subscribe to read the remaining 368 words of this article.
What’s included in a subscription?
Read The Information’s original, in-depth reporting and analysis
Receive as-they-happen articles via email
Talk with award-winning reporters in subscriber-only conference calls
Join the conversation on our subscriber-only Slack channel
Attend intimate, high-powered events with leaders in tech and business
Subscribe to The Information

But company executives believe it could enter the business with a few core advantages. Because it has existing relationships with merchants, it doesn’t need to pay to acquire them as customers. Through its payments business, Square also has data about these merchants to assess their riskiness.


Login or Subscribe to follow the discussions happening here and real-time in our   Slack Community.
Read comments from top tech and industry leaders
Evan Spiegel
Evan Spiegel
CEO, Snapchat
Chamath Palihapitiya
Chamath Palihapitiya
Founder & Managing Partner, SocialCapital
Marc Andreessen
Marc Andreessen
Co-Founder, Andreessen Horowitz
Jonah Peretti
Jonah Peretti
CEO, Buzzfeed
Adam D'Angelo
Adam D'Angelo
CEO, Quora
Brit Morin
Brit Morin
Founder & CEO, Brit + CO
Dustin Moskovitz
Dustin Moskovitz
Co-Founder, Asana
Christina Miller
Christina Miller
President & General Manager, Turner
Max Levchin
Max Levchin
CEO, Affirm
Adam Mosseri
Adam Mosseri
Director of Product, Facebook
Alex Mather
Alex Mather
The Atheltic
Martha Josephson
Martha Josephson
Partner, Egon Zehnder
James Murdoch
James Murdoch
Co-Chief Operating Officer, 21st Century Fox
Andrew Kortina
Andrew Kortina
Founder, Venmo
Ben Chestnut
Ben Chestnut
Co-Founder & CEO, Mailchimp
Ruchi Sanghvi
Ruchi Sanghvi
VP Operations, Dropbox
To fulfill its big valuation, and CEO Jack Dorsey’s ambitions to reinvent payments, the company needs new products targeted at consumers and products with higher margins.

RECENT ARTICLES

The Information’s Latest Free Agents