I was going through some of my draft postings and ran into this one about Square from GigaOM Mobilize 2012 conference. The talk is not fresh in my mind, so I’ll piece together what I can remember, but thank goodness I documented some good notes.
The then COO of Square, Keith Rabois, did a one-on-on interview on stage and talked about the landscape of mobile payments and Square’s latest customer win with Starbucks.
At the time, Square had 400 employees and an unconfirmed evaluation of $3.25B when they raised $200M (date not sure). From a COO perspective, Keith said that people keep him up all night. He wants to be sure that everyone is aligned (strategically) at the company. Square is “building a vertically integrated a payment system” that can scale for every person and treat every person as a VIP. Back in late 2012, 35M total Americans have paid with Square.
The conversation then moved onto Starbucks which I found more interesting since PayPal could have very well been the mobile payment partner instead of Square. From the first meeting with Starbucks to close, it was over a period of 8 weeks. I believe someone knew someone which is why the deal closed so fast.
Keith said (at the time) the #1 search in Square was for coffee. He also commented that about 40M Americans shop in Starbucks every month with about 75% of these transactions being anonymous (I’m assuming not with Starbucks card, not with credit card, paid in cash).
He claimed that by having Starbucks forge a relationship with Square, Square can help Starbucks know the identities of their customers and help Starbucks treat all of their customers like a VIP. Hmm, I wonder if this is the case today. Last I heard, some Starbucks employees don’t even know what Square is and don’t know how to process Square payments. Where’s my VIP treatment Starbucks?!
In terms of mobile payments, Keith is a believer that “NFC is going nowhere in the United States” and that the technology isn’t any good, it has no value proposition.
Keith did make one comment that made me chuckle a bit:
Moderator: “You have 400 people, but PayPal has 6K in customer service alone…”
Keith: “They obviously need it!”