Square is considering various strategic options as it has raised $200 million in funding and secured a $20 million line of credit. Potential acquirers include Google, Apple, and Starbucks, each with their own pros and cons. An IPO is also an attractive option, which would allow Square to move beyond payments processing and further develop its software, data, and payments offerings. PYMNTS will provide ongoing coverage of Square's path forward.

1. Proprietary and Confidential
April 11, 2014
With a famous CEO in Jack Dorsey, $200 million in equity
financing and a newly secured $20 million line of credit—
Square has the Silicon Valley buzzing with one question—
what are they going to do next?
Sell out to Google? Go for the IPO? Raise more money?
The options seems endless and PYMNTS wants to help you
understand them all.
PYMNTS.com Tour of the many industry players courting Square
Square’s Many Suitors:
A Silicon Valley Love
Story

2. Proprietary and Confidential
Google: The Rich Guy
What to Love
1.Google reportedly is
considering an $8 billion
dollar offer, far north of the
Square $5 billion valuation
2.Helps Google in its
question to more efficiently
gather customer
informiation and target
better adds.
3.Could offer valuable
support for
the struggling Google mWallet.
2 |
Somewhat Less
Appealing
1.Dorsey and Google
estranged after Google’s
attempt to purchase
Twitter.
2.Google rumors are
old hat.
3.“Jack does not want to
sell to Google,”
according to one insider
quoted anonymously by
Recode.

3. Proprietary and Confidential
Apple: The Artist Less Appealing
1.Apple is widely considered
an mWallet wild card.
2.Apple’s Square acquisition
rumors have been rampant for
years, but nothing has come
of it.
3.Apple is more into
developing services for its
mobile devices than
interested in offline solutions
like Square
4.Apple has reportedly soured
on the idea of acquiring
Square
What to Love
1.CEO Dorsey has commented
that Square’s design aesthetic
is similar to Apple’s and
indicated he thinks they are a
better match than Google.
2.Square’s hardware chief
Jesse Dorogusker worked at
Apple for more than eight
years.
3.Apple has sold Square
products in its Apple Store
Locations.
4.Give Apple a necessary jump
forward as it enters the
mWallet race late.
3 |

4. Proprietary and Confidential
Starbucks: The Run-Away Suitor
Less Appealing
1.Howard Schultz left the
Square board of directors
after only I year.
2.Starbucks mobile app is a
competitor for the Square
mobile wallet because it
allows consumers to pay with
it.
3.Starbucks did not adopt
Square POS technology and
has used it only as a lower-
cost processing service.
What To Love
1.Inked a deal with
Square in 2012 to have
Square process all credit
card transactions.
2.Starbucks also agreed
to invest $25 million in
Square and had CEO
Howard Schultz sit on
Square’s board.
3.Was hoped to offer
Square access to the
larger Starbucks network
and exposure for the
Square mWallet.
4 |

5. Proprietary and Confidential
The IPO: The Open
Relationship
Less Appealing
1.As a processor Square’s
profit margins are low,
which will depress stock
price.
2.The company’s data and
software offerings are
immature and still in
development.
3.Square’s new e-
commerce marketplace,
Square Market, faces the
daunting task of competing
directly with eBay and
Amazon.
What To Love
1.An IPO would give Square
the freedom to move away
from its profitable roots as a
processor into a bigger
future as a
software/data/payments
hybrid.
2.Strong name recognition
and deep industry backing
indicates it could get a high
stock price.
3.If Apple and Google are
out of the game, this is
probably the best option for
Square
5 |

6. Proprietary and Confidential
For More Information
Please see our exclusive PYMNTS.com coverage for more on Square’s way
forward …
•For More On square’s complicated relationship with google
•For More ON Square’s developing for apple
•For more on the early days of square and Starbucks.
Please sign up for our daily newsletter
SIGN UP
6 |

7. Proprietary and Confidential
For More Information
Please see our exclusive PYMNTS.com coverage for more on Square’s way
forward …
•For More On square’s complicated relationship with google
•For More ON Square’s developing for apple
•For more on the early days of square and Starbucks.
Please sign up for our daily newsletter
SIGN UP
6 |