Square just announced a huge partnership with Starbucks that will put the hot mobile payment startup in 7,000 Starbucks nationwide this fall. The news means that Square users will be able to use the app to pay at select Starbucks locations and find nearby stores in the Square Directory.
As part of the partnership, Starbucks is investing a cool $25 million in Square and the CEO of Starbucks will be joining Square’s Board of Directors. This is definitely a win-win for Square, Starbucks, and the mobile payment industry as a whole.
Twitter founder Jack Dorsey founded Square in 2010 as an iOS-only system for processing mobile payments in a beautiful way with the iPhone. An iPad app was later introduced alongside an Android version. A free Square Card Reader plugs into a smartphone or tablet’s headphone jack to accept credit cards and process payments instantly. Square takes a 2.75% cut of all transactions and requires no membership or activation fees. Starbucks customers will be able to use the free Pay with Square app to pay by opening a virtual tab in-store.
Here’s Jack Dorsey’s public letter announcing the partnership:
I am pleased and proud to announce that today Starbucks signed up for Square.
Square began with a really simple idea: everyone should be able to accept credit cards. It should be easy and free to get set up, it should use simple technology people already own, and, most importantly, it should instantly adapt to any size business—from the person chasing a dream to the largest organization on the planet. By embracing Square, Starbucks has validated these ideas as powerful tools—not just for small businesses, but for smart businesses.
It’s amazing to think that Starbucks began as a single coffee shop in Seattle. The concept of taking a good idea and helping it grow is not foreign to them, and Starbucks doesn’t just view Square as the simplest way to accept payments. They see an opportunity to extend and accelerate a model they grew up with: the idea that business is local and that community plays a vital role in job creation and economic vitality. 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. And with nearly 7,000 Starbucks stores soon accepting Square, these new payers will be able to find your business (including coffeehouses) and pay with their name, building community and creating value.
Our customers make us who we are, and we are proud of every single one of you—including our newest. Our promise to you remains the same: build simple, affordable, and fast tools that level the playing field for everyone. Thank you for helping us build Square. And please share your thoughts and tweets; I’m listening.
As Howard Schultz says: #Onward
“As the largest retail mobile payment platform in the U.S., we’re excited and proud to accept payments with Square,” said Howard Schultz, Starbucks chairman, president and ceo. “The evolving social and digital media platforms and highly innovative and relevant payment capabilities are causing seismic changes in consumer behavior and creating equally disruptive opportunities for business. Both Starbucks and Square take a similar approach when building products and running our businesses, and together we can bring the best possible payment experience to Starbucks customers.”
Apple will make its first foray into mobile payments with Passbook in iOS 6 this fall. Square and Dorsey have publicly admitted to being influenced by Apple and Steve Jobs, and Apple continues to showcase Square in its TV ads and promotional materials. The companies remain friendly with one another, and here’s to hoping we will see even closer involvement between the two in the future.