I spent this weekend in Portland, OR. Saturday was a lovely, sunny day and we walked everywhere. Besides taking in the city’s amenities, it gave me a chance to speak with local small business owners, particularly food truck owners. What could be better than eating my breakfast and lunch out of a truck and getting to ask a few business-related questions in the process. My topic of the day: Square.
For those of you unfamiliar with Square, it is a mobile payment service designed primarily for small businesses. Its founder is Jack Dorsey, co-founder of Twitter. I read about the company in May 2010, but first encountered it live at a tournament later that year, when the official tee-shirt vendor used it to process credit cards. I had seen him earlier in 2010 and it was clear his new payment system was worked better than his previous one. He showed me the square that plugged into his phone and said it he just got it but it was working well.
I love new technology, particularly technology that actually fixes or improves and has the potential to make real revenue – in other words disruptive technologies. My initial interaction regarding Square almost two years ago put the company on my radar.
Flash forward to my trip to Portland this past weekend and my Square-related questions there. The first people I spoke with were at Sonny Bowl located SW 3rd and Washington. When I ask what they thought of Square, the answer sounded like an ad:
- It was incredibly convenient.
- It was so much cheaper and easier than what was quoted by their bank.
- It isn’t has bulky as what the bank processing would have required.
- If it ever runs slow, they turn off the phone and turn it back on, then it works like a charm.
I assumed from this response, most of the city’s more than 200 food trucks must be using Square. I even imagined a “Sponsored-by Square” sign on the busiest truck lots. Interestingly, that doesn’t seem to be the case. My limited, unscientific survey showed that about half accepted credit cards – mostly via Square – and the other half were cash only.
I spoke with Flo of Flogene’s Home Cookin’, at SW 9th and Adler. Her food truck has been open a year and business has been booming. Her business is cash only and she hasn’t seen a need to begin accepting credit cards. In fact, she said they have a credit card machine from the bank, but only receive one request to use a credit card about every three months. Arguably, the large “cash only” sign and the abundance of ATMs around the site could be the reason for the low requests for credit card payments. Flo puts it simply, “We haven’t seen a need. If we thought we would lose business by not accepting credit cards, we would start. So far, we don’t have a need.”
The third person with whom I spoke about credit cards was a cab driver. He actually did accept them, but it was so old school that even though my credit card was swiped, he still needed to use a manual credit card imprint machine with carbon copies. He complained about the slow process and occasional dropped connections with his cab company’s credit card processor. I don’t work for Square, but it was the one time during the trip where I felt like I could have been an ambassador for the company. I stepped out of the cab saying to my husband: why would the company use such an antiquated system, when the driver has a smartphone right there and could be running the payments so much easier?
The next 12-18 months should be interesting for Square. A year ago, Kleiner Perkins led its $100 million series C round. The company continues to grow. I’m looking forward to seeing the product and business developments sure to come soon.
