In the wake of intense speculation, Square, Inc. has announced that it is ready to have an initial public offering. The financial services, merchant services aggregator and mobile payment company has stated that it will offer approximately $275 million in stock, although this figure may change. The company was founded in 2009 by Jim McKelvey and Jack Dorsey, the latter of whom is also the CEO of Twitter (NYSE: TWTR); over the past years, Square has had a major influence on how mobile payments are conducted, and as a result has garnered a lot of attention from potential public investors. However, a number of factors-such as a poor 2015 IPO season and Jack Dorsey's position as a now-dual CEO-make Square's IPO prospects far from certain.
The 2015 IPO market has not been a strong one; the number of IPO's this year is down approximately 36% from 2014. Those companies who went public in 2015 have, on average, a 3.5% price decline from their original offering prices. In order to establish confidence in potential investors, Square should be able to show that it is growing both quickly and profitably-however, this is not entirely the case. Square may be growing, but it has yet to turn a profit. Its revenue did increase to $840 million in 2014, but its losses also rose to $154 million. The company is still reeling from its 2012 partnership with Starbucks (NASDAQ: SBUX), in whic...
In the wake of intense speculation, Square, Inc. has announced that it is ready to have an initial public offering. The financial services, merchant services aggregator and mobile payment company has stated that it will offer approximately $275 million in stock, although this figure may change. The company was founded in 2009 by Jim McKelvey and Jack Dorsey, the latter of whom is also the CEO of Twitter (NYSE: TWTR); over the past years, Square has had a major influence on how mobile payments are conducted, and as a result has garnered a lot of attention from potential public investors. However, a number of factors-such as a poor 2015 IPO season and Jack Dorsey's position as a now-dual CEO-make Square's IPO prospects far from certain.
The 2015 IPO market has not been a strong one; the number of IPO's this year is down approximately 36% from 2014. Those companies who went public in 2015 have, on average, a 3.5% price decline from their original offering prices. In order to establish confidence in potential investors, Square should be able to show that it is growing both quickly and profitably-however, this is not entirely the case. Square may be growing, but it has yet to turn a profit. Its revenue did increase to $840 million in 2014, but its losses also rose to $154 million. The company is still reeling from its 2012 partnership with Starbucks (NASDAQ: SBUX), in whic...