Square, the Jack Dorsey-led firm that promised to shake up the payments market by enabling small traders to accept payments on smartphones and tablets, has financial services giant Visa as a ten per cent shareholder.
The credit card giant disclosed its stake in a regulatory filing. Visa was known to be a shareholder in Square (it invested in 2011) without revealing the size of its stake.
Square held a successful IPO at the end of 2015, albeit conservatively priced.
The firm’s recognisable dongle enables smaller businesses to transform a smartphone or tablet into point-of-sale terminal. Once a business signs up for the dongle then Square processes its payments, its core business.
The firm succeeded in attracting many small traders to accept credit and debit cards where previously they only accepted cash by competitively pricing its rates for processing card payments.
Square’s prospectus for its IPO revealed that founder Dorsey and VC firms Khosla Ventures were its largest shareholders. Interestingly, Visa’s name did not feature in the list of leading shareholders.
Following the IPO it was revealed billionaire investor Leonard Blavatnik had built up a so called passive stake of 11.4 per cent in the mobile payments firm.