Square Recorded $100 Million In Losses In 2013, According To Reports

Conflicting reports suggest the mobile-payment startup may or may not have been in talks to sell to Google.

Square Recorded $100 Million In Losses In 2013, According To Reports
[Image: Flickr user Shardayyy]

Is Square looking to sell? The Wall Street Journal reports the mobile-payments startup discussed “a possible acquisition” by Google this year, citing three anonymous sources. Apple and PayPal were also said to have had informal discussions about a deal, too.


However–and this is pretty significant–TechCrunch claims “those talks did not in fact take place in any serious capacity,” according to multiple sources. On Twitter, Square employees refuted that such talks ever happened.

Perhaps more interesting, though, is this key nugget from the WSJ‘s report:

Square recorded a loss of roughly $100 million in 2013, broader than its loss in 2012, according to two people familiar with the matter. The five-year-old company paid out roughly $110 million more in cash last year than it took in, according to two people familiar with the matter. Over the past three years, the startup has consumed more than half of the roughly $340 million it has raised from at least four rounds of equity financing since 2009, two people familiar with the company’s performance said.

It seems Jack Dorsey‘s mobile-payment startup is at a crossroads. Despite rolling out new innovations like Cash–an email service that processes person-to-person payments–last year, the company recorded more than $20 billion in transactions, which landed the company about $550 million in revenue. The WSJ reports that “four-fifths of that money” was used to pay fees to payment networks like Visa and MasterCard, and to financial security intermediaries. Profit margins for Square–arguably the most robust and widely used mobile-payment startup to date–are hair-thin.

That said, if the innovative finance company were to sell, analysts estimate such a deal would be worth upwards of $5 billion.

About the author

Chris is a staff writer at Fast Company, where he covers business and tech. He has also written for The Week, TIME, Men's Journal, The Atlantic, and more.