Square raises $100 million at $6 billion valuation
Payments company Square has raised $100 million in new funding at a valuation of nearly $6 billion, according to a Delaware filing obtained by VCExperts.com and shared with Fortune. — The San Francisco-based company issued 6.4 million …
Context & Ripple Effects
The Delaware filing confirms what an August report of a $200M raise with Singapore's GIC participating only hinted at: Square has banked its first $100 million at a valuation near $6 billion, per VCExperts data shared with Fortune. That caps a steep climb through prior_coverage — $27.5M in early 2011, then $100M at a $1B valuation mid-2011, then $200M at $3.25B in September 2012 — roughly a six-fold markup in three years.
What the money is for is legible in the same month's news: Square signed a multimillion-dollar Victory Park Capital deal to fund its expanded small-business cash advance program and refreshed its peer-to-peer Cash app, so this is growth capital aimed at turning a card-reader company into a lender. The pickup was unusually broad — TechCrunch, Forbes, the New York Times and Apple-focused outlets all ran the filing story the same day.
First-order effects
- Square gains roughly $100M in new primary capital at a near-$6B mark, giving it balance-sheet firepower for the Victory Park-backed cash advance book rather than just hardware distribution.
- The filing converts the rumored GIC-linked round into confirmed traction, strengthening Square's hand with merchants and partners who read fundraising as durability.
Second-order effects
- Rivals in mobile point-of-sale and small-business lending now face a competitor that can underwrite merchant advances off its own raised capital, pushing them toward their own financing partnerships or balance-sheet commitments.
- Sovereign-wealth-style participation in a consumer-payments startup's private round signals that late-stage deals are drawing non-traditional investors, competing with venture funds for allocation.
Third-order effects
- If payments platforms keep monetizing through merchant lending, the industry line between payment processor and bank thins — and regulators eventually face the question of who oversees that credit.
- Successive private markups without a public listing widen the gap between paper valuations and liquidity for employees and early backers, the structural tension behind calls for longer stays private or earlier exits.
The trend: Late-stage private markets are re-rating payments startups on lending economics, with sovereign and crossover capital displacing traditional venture leads in mega-rounds.