Square Raises $100 Million Round At $1 Billion Valuation, Led By Kleiner Perkins
Square, the mobile payments company led by Twitter founder Jack Dorsey, is raising $100 million in new financing, led by big-time VC firm Kleiner Perkins, the WSJ reports. — The round values Square at $1 billion …
Context & Ripple Effects
Six months after Square's $27.5 million financing in January 2011, the company has closed a $100 million Series C at a $1 billion valuation, with Kleiner Perkins taking the lead slot. Square itself confirmed the round on its own feed, framing the money as fuel for letting anyone accept payments anywhere.
The step-up matters on two axes: the valuation roughly implies a steep multiple over where the company stood at the start of the year, and landing Kleiner Perkins puts one of Silicon Valley's marquee firms behind a founder, Jack Dorsey, whose primary fame still comes from running Twitter. The round was reported by the WSJ before Square's confirmation, showing how closely the payments startup is now tracked.
First-order effects
- Square gets a nine-figure war chest to scale its card-reader distribution and merchant acquisition, converting the momentum of the January round into national rollout capacity.
- Kleiner Perkins' lead position gives Square institutional validation atop the $1 billion mark, resetting the negotiating baseline for any future financing.
Second-order effects
- The valuation sets a fresh benchmark for mobile payments startups, raising the price incumbents and rivals would pay for comparable teams or technology in the category.
- Dorsey splitting leadership between Square and Twitter concentrates two high-profile platforms under one founder, sharpening investor scrutiny of where his attention and both companies' roadmaps converge.
Third-order effects
- A $1 billion valuation within roughly a year of an earlier round fits the emerging pattern of top-tier firms writing large checks into pre-IPO consumer tech, pushing 'unicorn'-style valuations earlier into company lifecycles.
- If mega-rounds become the standard way payments startups fund hardware-plus-software rollouts, competitive advantage shifts toward whoever can raise at scale, squeezing out undercapitalized entrants.
The trend: Top-tier venture capital is concentrating ever-larger sums into mobile payments startups at billion-dollar private valuations well before any public listing.