NEW YORK (AP) — Square, the six-year-old company known for its white, cube-shaped card readers that plug into smartphones, is boosting its planned initial public offering value by 47 percent in what has become a very dicey market for new companies trying to raise cash.
The San Francisco financial-services startup was founded and is led by Jack Dorsey, who co-founded Twitter and recently returned to lead that company again. Dorsey, 38, who owns 24.4 percent of Square, did not give up the CEO job at Square when he returned to his former company.
Square Inc. plans to offer just over 31 million shares at a maximum of $13 apiece for total value of up to $403.7 million. That includes about 4 million shares set aside for underwriters. The company had previously filed regulatory papers for an IPO valued at up to $275 million.
Shares will trade under the symbol SQ on the New York Stock Exchange.
A number of companies have recently canceled IPOs, or scaled back their expectations, fearing malaise in U.S. markets.
Square helps small businesses process credit card payments and tablet computers, turning them into electronic sales terminals.
Since its founding, Square has added new operations like financing for small businesses and a payment service known as Square Cash that lets individuals and businesses transfer funds to each other. It also operates Caviar, a food delivery service for restaurants. The company plans to use net proceeds from the IPO of about $284.6 million for general corporate purposes, but said it is also looking at potential acquisitions to expand further.
The company had $850 million in revenue last year. Revenue for the first half of this year was $560.6 million, an increase of 51 percent over the same period last year. But, the company had a net loss of $154.1 million in 2014, and a loss of $77.6 million for the first half of 2015 and has warned that may continue to generate losses as it invests to expand.
Overall, it’s piled up an accumulated deficit of almost a half billion dollars since its inception.