Square, the company synonymous with the square-shaped mobile payment dongle that allows small businesses with smartphones to accept credit card payments, is reportedly on a mission to acquire food delivery startup Caviar.
The deal, according to The New York Times, which previously reported on Square's intentions, is valued at approximately $100 million. Now, further developments on the partnership are arising from Re/code which says that Square CEO Jack Dorsey plans to officially announce the deal at some point this week.
Re/code, citing a person familiar with the deal, revealed Dorsey's intentions. However, a spokesman for Square and Caviar CEO Jason Wang declined to comment on the purchase. Re/code's source also indicated that Caviar would only receive stock in Square as its payment.
Square is obviously moving down various avenues to expand its business. Recently, it has created the Square Capital cash advance program, the Square Feedback customer service platform, and the Square Order food pickup application.
Its food pickup app is among the closest of its new programs that might suggest Square could become, in part, a food delivery company. Up to this point, it has merely handled monetary and social transactions for services that others have conducted. With the acquisition of Caviar, though, it could itself become a delivery company that has any number of actual feet on the ground.
Caviar reportedly has 70 current employees. That number, though, does not count the number of independent contractors it hires to deliver meals. It works in approximately 10 cities in the U.S. and has several deals with restaurants that include Momofuku, in Manhattan, and Nick's Crispy Tacos in San Francisco.
This acquisition could give Square the power to bundle its new delivery service with its mobile payment system. It could offer proprietors discounts on bundling payment and delivery instead of choosing one or the other. Square, however, will continue to face the strong competition that Caviar already faces from the likes of DoorDash and GrubHub.
Edited by Maurice Nagle
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