Starbucks invests in Square
Starbucks customers to pay on their smartphone
Coffee giant Starbucks has invested $25 million (£16 million) in electronic payment service Square.
Created by Twitter co-founder Jack Dorsey, the technology allows buyers to insert their credit card into a small device that can be plugged into a smartphone.
The deal will see Square rolled out across 7,000 US Starbucks branches, and is seen as a major boost in the battle to beat competitors such as eBay’s PayPal and Swedish firm iZettle
Starbucks chief executive Howard Schultz will also join the Square board to oversee the introduction of the new payment method, which will be made available from the autumn. “As the largest retail mobile payment platform in the US, we’re excited and proud to accept payments with Square,” he said.
Square boss Dorsey looks to the future
Upon completion of the deal, Mr Dorsey published a letter on the Square website in which he hailed the opportunities the new investment would bring for other companies already signed up with the software.
Outlining his vision for the brand, he said: “When Starbucks builds the Square Directory into their apps and in-store Digital Network, it gives Square new visibility, driving more customers to opt-in to Square… these new payers will be able to find your business and pay with their name, building community and creating value.”
Mobile payments are becoming an increasingly popular market, with convenience for consumers and the prospect of saving money on expensive till systems for retailers making them an attractive proposition for all parties. And with over half the UK population owning a smartphone, there is likely to be demand for services such as Square on our shores.
Tom Glass, creative director at theEword, commented: “This is a massive deal for Square, one which could catapult them into the mainstream very quickly. Starbucks clearly rates the technology, and if the initial stages go well it shouldn’t be long before we see similar options available in UK branches.”