October 7, 2014
A spokesman from Square stated yesterday on the condition of anonymity that the company just closed its series E funding
The news of this last round of funding comes at a time when the industry is trying to get to terms with big developments: PayPal – eBay split, announcement of Apple Pay and CurrentC. There were also rumors that Apple and Square were in talks for acquisition but that Square pulled out of the deal.
According to industry experts, the new source of the capital, the Government of Singapore investment
According to different reports, Square’s valuation had recently fallen behind relative to the company’s payment processing volumes. The company is expected to process in excess of $30 bn this year, while its valuation was pegged at around $6 bn.
The competition in the card payments POS space is getting stiffer and new players including start-ups have launched new offerings at a rapid pace. Amazon launched its own card reader named Local Register earlier this year while Eventbrite also came up with its own version of a reader and an app.
This latest round places Square in the coveted league of Internet start-ups like Pinterest and Spotify that have valuations of around $5 billion to $6 billion.
The funding may be seen as a new lifeline for Square, which has already raised and spent millions of dollars in venture funding as it is fighting hard to turn its credit-card reading device business profitable.
Square was founded in 2009 by Twitter co-founder Jack Dorsey. In the past couple of years, the company’s losses have widened, and it has been trying to diversify beyond payments into new areas such as food delivery. It also launched Square Capital, a cash advance program for small businesses, in May this year. The company had a loss of roughly $100 million last year, wider than its 2012 loss according to some industry experts.
People are guessing how much time this latest round of funding might buy Square before it runs out of cash. In the first quarter of this year, a company executive said that the company had about 9 months before it would hit a cushion fund
Square’s credit-card reader is used at about one million merchants and retail outlets, and is attached to a smartphone or tablet, allowing them to accept credit or debit-card payments anywhere.