When asked about the news and speculation that Square could rival VeriFone’s size with only about a tenth of the sales, and no real profits, VeriFone chief executive Doug Bergeron responded with two words: ‘Pets.com’ — referring to the over-hyped dot-com that crashed and burned in 2000.
(via American Banker)
Given my past interactions with Verifone, I am not surprised that Bergeron feels that way. I am quite aware of their dislike of Square and Verifone bristles at the amount of the attention paid to company led by Jack Dorsey, the it founder for now. The two companies have been sniping at each other for a long time. Earlier this year, Verifone was caught using the text from Square’s legal user agreement. In 2009, when Square launched, I pointed out that that Square could potentially become a disruptive force for the likes of Verifone for it represented a new emergent people-to-people economy.
This peer-to-peer economy is a throwback to an older way of life, where folks used to barter for goods. It was a different kind of economic transaction, but still it was an economic transaction. The onset of industrialization brought in mass production and mass consumption into our societies. The Internet and by extension, mobile is going to help change that.
One of the things the Internet enables is our ability to connect with each other very quickly. The network is a springboard for services and platforms that enable one-on-one (or one-to-many) interactions. The easy to use tools — web and mobile — make it easier for like-minded people to congregate and engage in commerce.
Square is raising $200 million and is valued at about $3.2 billion, the New York Times has reported. I have heard similar valuations.
4 thoughts on “Verifone CEO hates Square”
Many small things add to a big thing.
What I mean by that is that big companies such as Verifone are quick to brush off small and new ideas that they end up missing the mark. Many of my friends who have been laid off in the last 3 years have decided to start their own business. Many of them are doing what they enjoy and providing a service, baked goods, or some form of product. They are happy and are able to make a living.
All of them take credit cards and they are all using Square. When I go to any of the local farmers market I see the vendor takes credit cards using Square.
Add all the small / micros businesses and eventually it will become a movement too large for big business to ignore. But, by then it will be too late. I just hope Square doesn’t go belly up for a big business to step in and replace the need after a small company did all the work.
Hmm – Maybe that is what Verifone hopes for. Wait for Square to fail and go under for them to step in with their own version of Square since the demand is there. Who benefited from the domain pets.com?
Square will make it for all the reasons you said. I am a small business and have a Square account. On large $ items the fee stops making sense. However, say a $1000 transaction for about a $23 fee? Not terrible. Is my math right?
Interesting point Zachary. What has been the experience for you so far – what is right and what hasn’t worked as well.
Om! Just saw that you replied in a Google search. So, even though it was August 1st… My experience with Square has been positive. As a one off positive it has been a conversational piece for me to introduce otherwise un-techified friends and family to the ‘Cloud’. Practically speaking it legitimizes small businesses by allowing them to align brand wise with Master Card, Visa, American Express. At our very small farmers market here in Ridgefield, WA. I think every vendor had a “We Accept Major Credit Cards via Square” at their booth. Pretty cool when you think about it.
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