Virgin boss Richard Branson has reputedly made a ‘multimillion dollar’ personal investment in Square, the US-based startup that enables small businesses to take credit card payments on their mobile phones.
Despite having launched only a year ago, Square has shipped over 800,000 card readers to merchants and is currently processing over $2 billion in payments annually. The company recently closed a $100M Series-C financing round led by Kleiner Perkins Caufield and Byers that valued the startup as a $1 billion Silicon Valley sensation..
In a posting on Virgin’s blog site, Greg Rose, senior content and marketing executive for Virgin Digital, says Branson took interest in Square’s rapid growth and novel technology, in particular its free hardware that allows anyone to accept credit card payments anywhere, anytime.
Branson is quoted as saying: “I’m very passionate about helping people start and grow successful businesses, and Square is an incredible technology that inspires and empowers everyone to be an entrepreneur.
Square is now offering an update to its Card Case application for iPhone 4 and iPhone 5 users, who can use it to make payments at local retailers without having to take their phone, their wallet, or credit card out of their pocket.
The service transmits an alert to phones when a transaction is completed, and works at about 20,000 US outlets that have signed up to accept Card Case payments. Card Case exploits a new location-based service in Apple’s latest iteration of its handheld iOS 5 device operating system.
The app can identify when a user’s phone is within 100 meters of a participating retailer and trigger the opening of a virtual tab with the merchant if the user opts into the hands-free payment service. Merchants can see which nearby customers are able to use Card Case to pay bills, and the app displays a picture of the user to prevent people from using someone else’s name. Square’s Megan Quinn says the company also plans to offer an Android version of the app.
Similarly, Wal-Mart outlets nationwide will soon be stocking Square’s credit card reader for smartphones, making it available in more than 9,000 retail stores. Square already is available in about 200 Apple stores, as well as Target, RadioShack, and Best Buy outlets.
Square’s Keith Rabois says his company is targeting small businesses for whom credit card transaction processing hardware may be unaffordable, noting that “our mission is to make Square ubiquitous.” Square is competing with PayPal and NFC providers to help shoppers pay on the go.
Square’s technology enables US businesses to process payments through the Apple iPhone and iPad, along with devices operating on Google’s Android software. Square is banking on consumers favoring its system over NFC. More than 800,000 Square devices have been shipped to retailers, and Square says it annually processes close to $2 billion in payments. PayPal recently announced that it anticipates more than $3.5 billion in mobile volume this year, and that it processed $29.3 billion in payments in the third quarter.