Mobile payments startup Square reportedly in talks with several rivals for a possible sale

By on April 21, 2014, 4:30 PM
rumor, acquisition, mobile payments, square

Mobile payments startup Square has been in talks with various big companies for a possible sale, according to the Wall Street Journal. The San Francisco-based company has been facing losses and is also running low on cash.

Square is a merchant services aggregator and mobile payments company which was founded in 2009 by Twitter co-founder Jack Dorsey and Jim McKelvey. As per the report, the company recorded a loss of about $100 million in 2013, and has consumed more than half of the around $340 million it raised from at least four rounds of equity financing since 2009.

People familiar with the matter told WSJ that the startup had acquisition-related discussions with Google earlier this year. The company also had informal talks with Apple and PayPal about a possible deal, the report notes.

Although none of the involved parties have yet acknowledged the talks, if a deal does happen, the company could fetch billions.

Square's credit card readers, that slot into smartphones, are used by nearly one million merchants, allowing them to accept credit or debit-card payments anywhere. The company generates just 2.75 percent on all card transactions, and pays a significant amount to card companies, which leaves it with a small profit margin. The start-up processed more than $20 billion in transactions last year, yielding around $550 million in revenue.

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