Square (payment service)
Encyclopedia
Square is an electronic payment service
, and the name of the card-reading device it uses. Square allows users in the United States to accept credit cards through their mobile phones, either by swiping the card on the Square device or by manually entering the details on the phone.
The name "Square" refers to the Square card readers which are square in shape. The name also refers to the commonly used phrase for payments: "Are we square?". However several other names were also considered and then rejected, these names include squirrel, stash and wallet.
, iPod Touch
, iPad
and Android-based mobile phones. Square was co-founded by Twitter
creator Jack Dorsey and Jim McKelvey. Dorsey also serves as CEO, Keith Rabois as COO.
Square currently has more than 100 employees.
At the TechCrunch
Disrupt conference in May 2011, Square announced the release of two new apps, Card Case and Register. Card Case allows customers to view merchant menus, do mobile payments, receive virtual receipts, and discover other Square-enabled merchants. Square Register is point of sale
software aimed at replacing traditional credit card terminals and cash registers.
Square's current office is located in the Chronicle Building in Mission Street
area of San Francisco.
, Kevin Rose
, Biz Stone
, Dennis Crowley
, Shawn Fanning
, Ed Cramer, and Esther Dyson
.
Square received Series A funding from Khosla Ventures
.
Square received Series B funding from Sequoia Capital
.
Square received Series C funding from Kleiner Perkins Caufield & Byers.
Square's current valuation is more than 1 billion dollars.
.
Square charges a fee of 2.75% on every credit card transaction. This rate is higher than the rate charged by conventional credit card processors, but Square claims that the conventional credit card processors also include many hidden costs which are never disclosed to the customers. Square claims that its costs are, on average, lower than the costs charged by the conventional credit card processors.
, iPod Touch
, iPad
and Android based mobile phones.
and it provides a point of sale credit card management system.
and Android and can be downloaded from the App Store and the Android Market
respectively.
Square uses strong encryption on its devices, these include SSL and PGP.
Square's 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.
. Many have said that Square is very much "like an Apple product". Jack Dorsey has been favorably compared with Steve Jobs
due to his entrepreneurial vision and charisma.
Square's website squareup.com has been praised for its elegant design and aesthetic appeal.
Square's product was also showcased at the Apple's iPad 2
event.
Square has been praised by GigaOM
for being a disruptive innovation.
claimed that the Square system 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. VeriFone posted a demonstration video and sample skimming app to its website. 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.
Payment system
A payment system is a system used for transferring money. What makes it a "system" is that it employs cash-substitutes; traditional payment systems are negotiable instruments such as drafts and documentary credits such as letter of credits. With the advent of computers and electronic...
, and the name of the card-reading device it uses. Square allows users in the United States to accept credit cards through their mobile phones, either by swiping the card on the Square device or by manually entering the details on the phone.
Creation
The original inspiration for Square occurred to Jack Dorsey in 2009 when James McKelvey (a friend of Dorsey at the time) was unable to complete a $2,000 sale of his glass faucets and fittings because he could not accept credit cards. McKelvey explained this problem to Dorsey who built a working prototype of Square.The name "Square" refers to the Square card readers which are square in shape. The name also refers to the commonly used phrase for payments: "Are we square?". However several other names were also considered and then rejected, these names include squirrel, stash and wallet.
Growth
Introduced in early 2010 by Square Inc., the Square application is available for the iPhoneIPhone
The iPhone is a line of Internet and multimedia-enabled smartphones marketed by Apple Inc. The first iPhone was unveiled by Steve Jobs, then CEO of Apple, on January 9, 2007, and released on June 29, 2007...
, iPod Touch
IPod Touch
The iPod Touch is a portable media player, personal digital assistant, handheld game console, and Wi-Fi mobile device designed and marketed by Apple Inc. The iPod Touch adds the multi-touch graphical user interface to the iPod line...
, iPad
IPad
The iPad is a line of tablet computers designed, developed and marketed by Apple Inc., primarily as a platform for audio-visual media including books, periodicals, movies, music, games, and web content. The iPad was introduced on January 27, 2010 by Apple's then-CEO Steve Jobs. Its size and...
and Android-based mobile phones. Square was co-founded by Twitter
Twitter
Twitter is an online social networking and microblogging service that enables its users to send and read text-based posts of up to 140 characters, informally known as "tweets".Twitter was created in March 2006 by Jack Dorsey and launched that July...
creator Jack Dorsey and Jim McKelvey. Dorsey also serves as CEO, Keith Rabois as COO.
Square currently has more than 100 employees.
At the TechCrunch
TechCrunch
TechCrunch is a web publication that offers technology news and analysis, as well as profiling of startup companies, products, and websites. It was founded by Michael Arrington in 2005, and was first published on June 11, 2005....
Disrupt conference in May 2011, Square announced the release of two new apps, Card Case and Register. Card Case allows customers to view merchant menus, do mobile payments, receive virtual receipts, and discover other Square-enabled merchants. Square Register is point of sale
Point of sale
Point of sale or checkout is the location where a transaction occurs...
software aimed at replacing traditional credit card terminals and cash registers.
Square's current office is located in the Chronicle Building in Mission Street
Mission Street
Mission Street is a north-south arterial thoroughfare in San Francisco, California that runs from the city's southern border to its northeast corner. The street and the Mission District through which it runs were named for the Spanish Mission Dolores, several blocks away from the modern route. Only...
area of San Francisco.
Financials
Square received angel investment from Marissa MayerMarissa Mayer
Marissa Ann Mayer is Vice President of Location and Local Services at the search engine company Google. She has become one of the public faces of Google, providing a number of press interviews and appearing at events frequently to speak on behalf of the company.-Education and career :After...
, Kevin Rose
Kevin Rose
Kevin Rose is an American Internet entrepreneur who co-founded Revision3, Digg, Pownce, and Milk...
, Biz Stone
Biz Stone
Christopher Isaac "Biz" Stone is a co-founder and Creative Director of Twitter, Inc and also helped to create and launch Xanga, Blogger, Odeo, and , founded in June 2011 with his long time collaborators Evan Williams and Jason Goldman to focus on building systems that help people work together to...
, Dennis Crowley
Dennis Crowley
Dennis Crowley is an American internet entrepreneur best known for co-founding the popular social networking sites Dodgeball and Foursquare.-Education:...
, Shawn Fanning
Shawn Fanning
Shawn Fanning is an American computer programmer, serial entrepreneur, and angel investor. He developed Napster, one of the first popular peer-to-peer file sharing platforms, in 1998. The popularity of Napster was widespread and Fanning was featured on the cover of Time magazine...
, Ed Cramer, and Esther Dyson
Esther Dyson
Esther Dyson is a former journalist and Wall Street technology analyst who is a leading angel investor, entrepreneur, philanthropist, and commentator focused on breakthrough innovation in healthcare, government transparency, digital technology, biotechnology, and space...
.
Square received Series A funding from Khosla Ventures
Khosla Ventures
Khosla Ventures is a venture capital firm focused on early stage companies in the Internet, computing, mobile, silicon technology and clean technology sectors....
.
Square received Series B funding from Sequoia Capital
Sequoia Capital
Sequoia Capital is a Californian venture capital firm located on Sand Hill Road in Menlo Park, California. The Wall Street Journal has called Sequoia Capital "one of the highest-caliber venture firms", and noted that it is "one of Silicon Valley's most influential venture-capital firms"...
.
Square received Series C funding from Kleiner Perkins Caufield & Byers.
Square's current valuation is more than 1 billion dollars.
Business Model
Square currently provides its card readers for free to its users. The Square app is also freely downloadable from the App Store and the Android MarketAndroid Market
Android Market is an online software store developed by Google for Android OS devices. Its gateway is an application program called "Market", preinstalled on most Android devices, allows users to browse and download mobile apps published by third-party developers...
.
Square charges a fee of 2.75% on every credit card transaction. This rate is higher than the rate charged by conventional credit card processors, but Square claims that the conventional credit card processors also include many hidden costs which are never disclosed to the customers. Square claims that its costs are, on average, lower than the costs charged by the conventional credit card processors.
Card reader
The card reader is a plastic device which plugs into the audio jack of an iPhoneIPhone
The iPhone is a line of Internet and multimedia-enabled smartphones marketed by Apple Inc. The first iPhone was unveiled by Steve Jobs, then CEO of Apple, on January 9, 2007, and released on June 29, 2007...
, iPod Touch
IPod Touch
The iPod Touch is a portable media player, personal digital assistant, handheld game console, and Wi-Fi mobile device designed and marketed by Apple Inc. The iPod Touch adds the multi-touch graphical user interface to the iPod line...
, iPad
IPad
The iPad is a line of tablet computers designed, developed and marketed by Apple Inc., primarily as a platform for audio-visual media including books, periodicals, movies, music, games, and web content. The iPad was introduced on January 27, 2010 by Apple's then-CEO Steve Jobs. Its size and...
and Android based mobile phones.
Card case
The card case allows customers to set up tabs and pay with their names. It also enables them to receive electronic receipts.Square Register
The Square Register is available for the iPadIPad
The iPad is a line of tablet computers designed, developed and marketed by Apple Inc., primarily as a platform for audio-visual media including books, periodicals, movies, music, games, and web content. The iPad was introduced on January 27, 2010 by Apple's then-CEO Steve Jobs. Its size and...
and it provides a point of sale credit card management system.
Square App
The Square App is available free of cost for iOSIOS
iOS is an operating system for iPad, iPhone, iPod Touch, and Apple TV.IOS may also refer to:-Companies and organisations:* Illinois Ornithological Society, American state-based bird club...
and Android and can be downloaded from the App Store and the Android Market
Android Market
Android Market is an online software store developed by Google for Android OS devices. Its gateway is an application program called "Market", preinstalled on most Android devices, allows users to browse and download mobile apps published by third-party developers...
respectively.
Technology
Square's Technology is PCI compliant and Verisign certified.Square uses strong encryption on its devices, these include SSL and PGP.
Square's 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.
Reception
The Square product has been praised for its ease of use, simplicity and elegance by Business InsiderBusiness Insider
Business Insider is a U.S. business/entertainment news website launched in February 2009. Founded by DoubleClick Founder and former C.E.O. Kevin P. Ryan it is the overarching brand beneath which fall the Silicon Alley Insider and Clusterstock verticals...
. Many have said that Square is very much "like an Apple product". Jack Dorsey has been favorably compared with Steve Jobs
Steve Jobs
Steven Paul Jobs was an American businessman and inventor widely recognized as a charismatic pioneer of the personal computer revolution. He was co-founder, chairman, and chief executive officer of Apple Inc...
due to his entrepreneurial vision and charisma.
Square's website squareup.com has been praised for its elegant design and aesthetic appeal.
Square's product was also showcased at the Apple's iPad 2
IPad 2
The iPad 2 is the second and current generation of the iPad, a tablet computer designed, developed and marketed by Apple. It serves primarily as a platform for audio-visual media including books, periodicals, movies, music, games, presentations and web content, and is available in black or white...
event.
Square has been praised by GigaOM
GigaOM
GigaOM is a Web 2.0 blog started by Om Malik and published by Giga Omni Media, Inc. in San Francisco, California. According to the company website it has a monthly global audience of 500,000. It is among the top 50 blogs worldwide by Technorati Rank, and is listed on CNet's Blog 100 list...
for being a disruptive innovation.
Criticism
In March 2011, rival payment company VeriFoneVeriFone
VeriFone is a company that makes point-of-sale equipment. It was founded and incorporated in Hawaii in 1981, and named itself after its first product, the name standing for Verification telephone....
claimed that the Square system 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. VeriFone posted a demonstration video and sample skimming app to its website. 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.