So how would the savvy entrepreneur "bet" on Square, given that you can't directly invest in it? What kind of product/service would you build if you assumed this pervasive mobile payment platform?
I have posted the following on HN a couple times; Square is a platform.
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I think that Square is an exceptional business enabled by a novel piece of hardware, their headphone jack card reader.
It would seem - then, that the card reader and payment service could actually be seen as a platform play.
Platforms are technologies that are useful themselves - but enable far reaching, broader use cases in ways, that at times, can be unforeseen.
Square could enable a range of cottage industries by providing other applications built on their solution.
We have the ability for mobile payments, as it were, and thus we should see a need for dead-simple mobile business management apps; inventory, supply chain, vendor management, invoicing, product lists etc.
This leads me to believe that Square is a platform that, through its deployment, applications can be built upon it that will change the way commerce can happen on the individual level.
Further - it would seem that there is also a great opportunity for sales distribution here as well. A product distributor could reach out to and enable a mobile sales force providing all these applications to their sales force in the field on a single device - as the merchants sell product, it can be tracked in real time and supplies replenished.
This could work very well in connected, yet less-developed countries such as rural Philippines, China and other parts of Asia. (areas where the vast majority of the population have mobile phones, but other forms of infrastructure are less developed)
Couple this with prepaid charge cards -- and the ability to LOAD cards in the longer term, and there are some significant opportunities that can be built using square alone.
Square charges a flat 2.7%, with no monthly charges. A merchant account with a payment gateway costs around $30 a month and 2.5%, accepting AMEX cost another $15 a month and the rate is 3.3%, but Squate does that for free.
Also, can anyone familiar with point of sale systems compare the two?
I saw an interview with Jack once where he mentioned cool reporting without going into details. It seems possible that the value of Squares should also include the cost/fees of POS systems (minus cost of your ipad/iphone/ipod that connects to your Square).
Their iPad app is a bit more comparable, but you'd really be pushing it to say that their iPod/iPhone app can replace a point-of-sale system.
Square is perfect for mobile business like landscapers, plumbers, artists, etc. But for businesses with a brick & mortar location, they're missing a lot of the things so they won't be replacing pos system as is.
Some of the standard point-of-sale features that Square is missing I don't ever see them getting in to. Things like cash management, re-ordering inventory, employee time clocks... that's what store owners are looking for in a pos system.
The iPad app is OK for more simple businesses, which is why they always show it in a coffee shop and not a retail store. If they offered a payments API I think they would be able to break into this market not by replacing the POS, but by replacing the credit card terminal.
It would be interesting to know if they're still processing 33% of transactions as cash. It would also be interesting to know how much of the non-cash mix is fraudulent.
