
Jack Shares Some Big, Square Numbers: 341,688 Readers Shipped, $137M Total Flow - atularora
http://techcrunch.com/2011/04/29/jack-dorsey-shares-some-big-square-numbers-341688-readers-shipped-137m-total-flow/
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charlesju
So at 1% fees, Square is making $1.37 M in revenue?

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veyron
at 0% fees, Square is making $0.00 M in revenue

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riffer
What happens to all these payments startups when credit card fees go from 3%
=> 0.3%?

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mmcconnell1618
That won't happen. The credit card cartel will ensure the transaction fees
stay in the 1.5% to 3% range because if they don't they can't meet quarterly
profits. Regardless of the technical infrastructure the companies will be
fighting an up-hill battle against hundres of years of banking history. Also,
why do you think the credit card companies are quickly investing in these
startups? A: To ensure control.

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riffer
>>> That won't happen

Better take another look at Dodd Frank

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seanharper
Did you actually read dodd frank? Because you are completely wrong about what
it says. The Durbin amendment to Dodd Frank is a reduction of interchange fees
for _debit cards_ issued by _large banks_. It impacts ~50% of debit cards,
which are about ~30% of total cards, so 15% of cards in total. And it reduces
those fees by 60-80% (so from around 1.5% to < 1%). As a result, it is a very
minimal financial hit to the banks who ultimately receive the interchange
revenues.

Furthermore, Durbin amendment will not survive. I will bet anyone on this -
the banks are running a very aggressive FUD campaign which I suspect will
work. It sucks, but that's what is what's happening.

Also, keep in mind that the fees being legislated by Dodd Frnak are the
interchange fees that are actually the most significant expense for payments
companies such as square, so it could improve their profitability a lot. It
could also allow them to lower their fees and still make money, which coud
increase adoption.

Durbin amendment, if it survives, is a positive for Square and every other
payments company. It is a negative for the banks that ISSUE debit cards
(basically Chase, Citi and BofA).

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riffer
Good luck Sean

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pitdesi
Interesting numbers: an average of ~$6 worth of transactions per day per
reader sent out. I'm sure 95% of the readers are unused. I wonder how they
count revenue too - like what does that $59k today mean?

So $2 million divided by 23k payments today is $85... A fairly high average
transaction size, I'm assuming because they have a number of contractors/art
sellers that skew the number much higher. What's interesting is that those
guys would probably be better off with a standard merchant account (depending
on how much they are transacting per month) <http://feefighters.com/square-
calculator>

But they probably went with Square because it's easy. This totally flies in
the face of what I earlier thought, that square was being used primarily for
low dollar transactions.

