Squaring off with Square, for a good cause
One reporter's tale of spending an evening soliciting donations through the use of mobile gadget Square, the latest project from Twitter co-founder Jack Dorsey.
On Tuesday, I was enlisted to help out with an event in conjunction with the New York arm of the "Social Media Week" conference-fest--called "Digital Divas," the cocktail affair was organized by a handful of women involved in various niches of technology and digital media. Yes, dudes were allowed too.
As the event grew closer, we decided that we wanted some kind of Doctors Without Borders' relief efforts in Haiti. So after some brainstorming we thought about using Square, the new co-founded by Twitter Chairman . The event's main co-hosts got in touch with one of Square's executives, who generously shipped us two of the little gadgets--which --on very short notice.for guests to donate to support
And I got to field-test it! Along with Brooke Moreland of fashion site Fashism, I was equipped with a Square and some alpha software and given the mission of convincing party guests that yes, a major credit card and an odd little iPhone add-on could add up to more resources for a good cause.
In doing so I got an idea of some of the possibilities and challenges ahead for Square--and, in conjunction, the fast-growing array of other new innovations in payments.
Square is one of those companies that, in the jargon of Silicon Valley, gets described as "disruptive": taking a longstanding industry and shaking things up. This one, specifically, aims to clean up the red tape and intricate procedures involved with using a credit card to accept transactions--there are no subscriptions, no application process or contracts, and a mix of cool add-on features, like mobile receipts, automatic donations to nonprofits, and purchase tracking for frequent-customer perks.
The company's target market, at least from early indications, is a mix of small businesses, individuals, and grassroots activists. They're being tested out in a variety of coffee shops and other small outlets in New York and San Francisco, and recently, the devices were used to collect donations for Reshma Saujani, a New York congressional candidate who's been particularly active in reaching out to local entrepreneurs.
Clearly, Square is a new product. The credit card reader didn't always read swipes (Moreland's device seemed to have more issues than mine did here) and the software can be slow. These are all things that the company has plenty of time to tweak before Square hits the market. It also will have to contend with some mobile devices' deplorable battery life (I'm looking at you, iPhone) although Square reps tell me that the hardware itself does not contribute to any extra battery drain.
But it was obvious from Tuesday night's event that Square will face. Many of the guests came from industries outside the tech world's eager early-adopter set, were unfamiliar with the buzz surrounding Square, and weren't actually convinced that their donations would be making it to Doctors Without Borders. A few asked for more information and then declined to donate, with one saying it sounded "shady" and adding, "Why don't I just hand you a 10-dollar bill instead?"
Somebody else told me that maybe the skepticism would be less pronounced if the devices were backed by the likes of American Express or some other respected name in the financial services industry. But that's the whole point of Square--it isn't affiliated with anybody big. You're supposed to be able to sign up for an account right before your annual yard sale and be able to accept Visa payments for your unwanted beanbag furniture five minutes later.
It's evident that the app has promise, though. When it's running at optimum speed (and in this early phase, it often isn't), transactions are quick, commission fees are pretty reasonable, and some of the forthcoming features, like frequent-buyer perks, sound pretty cool. For the nonprofit side of things, Square could eventually make it easy to donate to individual charities by partnering with a nonprofit directory like GlobalGiving--Facebook-based donation app Causes taps into GlobalGiving, for example. I imagine a scenario in which you can sift through a directory of nonprofits to send an entire Square payment (or a collection of payments from an event you throw) straight to a charity of your choice.
Jack Dorsey's last big idea, Twitter, was a relatively novel concept. Square is going to have a tougher upward battle: most small businesses already use Verifone systems or the like, and other alternative-payment start-ups like Venmo are trying to make waves in a similar space. Twitter can credit a big part of its rise to a loyal pack of early adopters in the tech and media industry; Square is, without a doubt, going to have to do the same with small-scale retailers to make a name for itself. Then, ideally, the "shady" concerns will go away.