Curated Food Delivery Startup Caviar In Talks To Be Acquired By Square For $100 Million
Curated food delivery startup Caviar is in talks to be acquired by Square in a deal that could be worth at least $100 million, according to several sources. While we've heard the deal is slated …
Context & Ripple Effects
Talks of Square paying at least $100 million for Caviar cap a restless spring for the payments company: in May 2014 it pulled Square Wallet from Apple's and Google's app stores, killing its consumer-payments app, while doubling down on merchant features such as Square Order for pickup orders, offline payment collection, and letting customers pay merchants in advance. Reports have also circulated that Square is delaying its IPO amid growth problems, with confirmed concern over its high valuation and burn rate.
Against that backdrop, Caviar is a coherent pivot target: a curated food delivery service whose upscale restaurant partners sit squarely in Square's existing merchant base, giving Square a consumer-facing reason to reopen its apps after retiring Square Wallet. The acquisition remains unconfirmed — sources describe active talks, not a signed deal.
First-order effects
- If closed, the deal gives Square a consumer delivery brand and courier logistics to bolt onto Square Order's pickup product, restoring a consumer hook two months after Square Wallet was pulled.
- Caviar's partner restaurants move from a venture-funded intermediary to an acquisition backed by Square's payments rails, deepening Square's grip on the same merchants it sells point-of-sale software to.
Second-order effects
- Restaurants gain the option of bundling ordering, delivery, and payments with one vendor instead of separate delivery and POS contracts, squeezing standalone delivery platforms on take rates and exclusivity.
- A Square reportedly burning cash and delaying its IPO choosing to spend nine figures on growth signals it will buy adjacent transaction volume rather than shrink — raising the competitive bar for anyone courting the same urban restaurants.
Third-order effects
- The pattern points toward payments companies becoming full-stack local-commerce platforms, where the point-of-sale system is the distribution channel and delivery becomes a feature sold through it rather than a standalone business.
- If Square folds delivery economics into merchant pricing, food delivery consolidates around whoever owns the restaurant's money flow, shifting leverage from demand aggregators to payment processors with merchant relationships.
The trend: Merchant payments providers are buying their way up the stack from processing transactions to owning the consumer ordering and delivery relationship.