Square, Inc. is a financial services, merchant services aggregator, and mobile payment company based in San Francisco, California. The company markets several software and hardware payments products and has expanded into small business services. The company was founded in 2009 by Jack Dorsey and Jim McKelvey and launched its first app and service in 2010. It has been traded as a public company on the New York Stock Exchange since November 2015 with the ticker symbol SQ.

The original inspiration for Square occurred to Jack Dorsey in 2009 when Jim McKelvey (a St. Louis 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.^[6]

Dorsey and McKelvey began developing the company out of an office in St. Louis. Before Square became the successful, San Francisco-based tech company it is today, co-founders Jack Dorsey, who also co-founded Twitter, and Jim McKelvey worked out of a small office in their hometown, St. Louis.^[7]

The name "Square" derives from the company's square-shaped card readers.^[8][9]

The Square Reader was the firm's first product. It accepts credit card payments by connecting to a mobile device's audio jack. The original version consisted of a simple read head directly wired to a 3.5 mm audio jack, through which unencrypted, analog card information was fed to smartphones for amplification and digitization.^[10]

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 use the Square device to skim a credit card and return its details, because of the lack on encryption. VeriFone posted a demonstration video and sample skimming app to its web site.^[11] Dorsey called VeriFone's claims "neither fair nor accurate", noting that all card data also be compromised by visually examining the card, and that even if there were compromise, card issuers offerred fraud protection.^[12]

Square now uses strong encryption on its devices, ^[13] and neither card numbers, nor magnetic stripe data, nor security codes are stored on Square client devices.^[13] The current technology is Payment Card Industry Data Security Standard (PCI) compliant and Verisign certified.^[13]

In July 2014, ahead of the October 2015 EMV liability shift, the firm announced a card reader that would accept chip cards and contactless cards to supplement the standard Reader's support of traditional magnetic stripe card transactions.^[14] In June 2015, Apple announced Square would release a new Reader capable of also accepting Apple Pay and other contactless payments.^[15] In August 2018, Square released a version of its magstripe reader with a lightning connector, allowing it to be used on iPhones without a headphone jack.^[16]

In June 2013, the firm unveiled Square Stand, which turns the Apple iPad into a more complete point-of-sale system. ^[17] In 2015, Square launched a bluetooth-connected reader that works for Android and iOS devices to accept chip and contactless payments through their platform.^[18] In October 2017, a standalone point-of-sale system, Square Register, was announced for small to medium-sized businesses.^[19] It consists of a merchant tablet and a customer tablet, with a built-in swipe, chip, and tap reader.^[20] In October 2018, the company introduced a self-contained Terminal product that features a display, prints receipts, and accepts chip, swipe, and contactless payments.^[21]

In December 2012, Square began allowing merchants to issue virtual gift cards; a QR code is scanned from the customer's smartphone to use the funds.^[22] Physical gift cards were added in the service in 2014.^[23]

In 2014, Square launched Square Capital, which offers business financing to merchants using Square.^[24]

In 2014, an online booking tool was added to the firm's offerings, allowing small businesses to accept appointments on their website.^[25] The service only accepts scheduled appointments based on a service provider's availability, and does not accept restaurant reservations.^[26]

In 2015, the firm launched Square Payroll, a tool for small business owners to process payroll for their employees. The product, available in all 50 states + DC, automatically handles a business's withholdings, payroll payments, and tax filings.^[27]

In 2018, Square began allowing merchants to develop custom interfaces for the platform, via an application programming interface.^[28]

Cash App (formerly Square Cash) allows person-to-person money transfer via the app or website. In March 2015, the firm introduced Square Cash for businesses, which includes the ability for individuals, organizations, and business owners to use a unique username, known as a $cashtag, to send and receive money.^[29] In January 2018, the app expanded to support bitcoin trading.^[30]

On August 4, 2014, Square announced the acquisition of Caviar, a startup that delivers meals from high-end restaurants.^[31] Caviar uses a fleet of couriers to provide delivery for popular restaurants who do not otherwise deliver.^[32] Caviar is currently available in 18 markets in the U.S.^[33] Users can order via the company's iOS or Android app,^[34] or on Caviar's website.^[35] In 2016, a class action lawsuit was filed against Square, claiming that the company falsely represented that 18% of the gratuity charge from each Caviar order will be given to the drivers while the drivers did not receive any part of it. In 2018, Square agreed on giving $2.2 million to settle the lawsuit while denying the claims against them.^[36]

Caviar eventually replaced Square Order, an app which allowed users to make purchases in advance and pick them up at a predetermined time. In March 2015, Square announced that it was shutting down Square Order .^[37] In 2018, Caviar took a step into corporate catering by acquiring Zesty, a San Francisco-based catering platform.^[38]

In 2018, the firm launched a subscription service for restaurants. In addition to processing payments, the system can track table locations, tip splitting, and menus.^[39] The system directly integrates with the Square-owned online food-ordering service Caviar, with plans to include other similar services in the future.^[40]

On August 1, 2019, it was announced that DoorDash will acquire the food delivery app Caviar from Square.^[41]

Square received angel investments from Marissa Mayer, Kevin Rose, Biz Stone, Dennis Crowley, Shawn Fanning, MC Hammer, and Esther Dyson.^[42] Since then, it has raised several additional rounds of funding:

The company's valuation in October 2014 was $6 billion.^[45]

On November 19, 2015, Square had its IPO on the New York Stock Exchange with an initial valuation of $2.9 billion, down by more than half from its last valuation in October 2014 at $6 billion. Although the firm has yet to make a profit and has lost $420 million since 2012, it has decreased its losses from 44% of revenues to 16% in the six months leading up to its IPO.^[46]

For the fiscal year 2018, Square reported losses of US$38 million, with an annual revenue of US$3.299 billion, an increase of 49.0% over the previous fiscal cycle. Square's shares traded at over $75 per share, and its market capitalization was valued at US$32 billion in November 2018.^[47]

Square was co-founded by Twitter creator Jack Dorsey.^[48] Dorsey also serves as chief executive officer and Amrita Ahuja serves as chief financial officer following Sarah Friar.^[49][48]

Square's office is in San Francisco.^[50] The firm has more than 2,000 employees.^[51]

Square has been available in the United States since 2010 and the company launched in Canada at the end of 2012.^[52] In May 2013, the firm 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.^[53] It launched in the UK in 2017.^[54]

As of March 2013, Square provides its magnetic stripe card readers to users for free.^[55] Square charges $99 for Square Stand and $29 for its chip-based Square Reader.^[56] 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.^[57] 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. The firm claims that its costs are, on average, lower than the costs charged by the conventional credit card processors.^[58] Square is regarded as a useful app for entrepreneurs, including, for example, consultants, food truck operators, and traditional retailers.^[59] Swiped payments are deposited directly into a user's bank account within 1 or 2 business days. In some instances, Square may withhold payments to its users pending issues related to chargebacks.^[60] The firm also generates revenue from selling other services to businesses, including subscription-based products such as Customer Engagement, Square Payroll, and Square Register. For example, with Square Payroll, Square charges sellers a monthly fee of $20 plus $5 for each employee paid.^[61]

At the TechCrunch Disrupt conference in May 2011, Square announced the release of two new apps, Square Card Case (later rebranded as Square Wallet)^[62] 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.^[63]

In July 2013, the firm launched Square Market, which allows sellers to create a free online storefront with online payment processing functionality.^[64] In March 2014, the firm announced it will start allowing sellers to accept bitcoin on their own storefronts through Square Market. The seller will take no risk on bitcoin value fluctuations.^[65]

In August 2014, Square secured an investment from Victory Park Capital, an asset management firm, to extend "hundreds of millions of dollars" to small businesses via Square Capital.^[66] In May 2015, Square secured additional outside investments for Square Capital, with Victory Park Capital tripling its initial investment.^[67] In its 2016 third-quarter earnings report, Square reported that it had loaned $1 billion to companies through Square Capital since the program's inception.^[68] In October 2015, Square Inc. filed an IPO to be listed on the New York Stock Exchange.^[69] Shares were priced at $9 on November 18, 2015, and on November 19, 2015, Square officially began trading.^[70]

On April 19, 2018,^[71] Square announced that it had acquired Zesty, a food delivery service that caters to corporate offices.^[72]

On April 26, 2018, Square announced that it would acquire Weebly, a website-building service, for $365 million.^[73]

As of May 2019, Square announced that it had acquired Eloquent Labs, an artificial intelligence startup helping improve the customer service experience. ^[74]

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 called his "entrepreneurial vision and charisma".^[75][76] The Next Web praised Square's website, squareup.com, for its design and aesthetic appeal.^[77] The product was also showcased at Apple's iPad 2 event.^[78] GigaOM called the product a disruptive innovation.^[79]

In May 2013, Square announced it would no longer allow firearms-related transactions to be performed using its devices or software. The company amended its 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.^[80]

In June 2019 The Wall Street Journal reported that Square inadvertently sends transaction receipts to the wrong email address, leading to adverse consequences such as outing one woman's impending divorce.^[81]