18 Nov Square’s gone public. Now the hard part begins.
Square has officially gone public, and now the payments-processing company needs to put its money where its mouth is.
With its market debut, chief executive Jack Dorsey had a lot to celebrate Thursday. His mother Marcia rang the bell for the market’s open — even though the IPO happens to fall on his 39th birthday. But he also faces serious skepticism from analysts casting a wary eye at Square’s core business, and its promises to revolutionize the way companies accept payments.
Perhaps as a nod to the unease about its IPO, Square said Wednesday that it would price its offering at $9 per share, significantly below its expected range of $11-$13. That came as a surprise to many longtime company observers, some of whom had already commented that the original range seemed low.
Shares jumped as high as $14.78 shortly after the opening bell, before settling a bit to just above $13 per share, giving the company a value of $4.77 billion. Even with a strong first-day pop in early trading on the New York Stock Exchange that topped its original range, that’s still lower than what shares of the company were reportedly going for on the private market.
Square launched in 2009 as a company that made a small card reader that plugs into smartphones and tablets. It aimed that product at very small businesses that had shied away from installing traditional card readers due to hardware and processing costs. More than 2 million businesses now use Square’s products, which have expanded to a suite of hardware and software products designed to help merchants manage everything from their registers to their payroll.