Square IPO Pricing Will Test Investors' Appetite for Unicorns
- Mobile-payments company scheduled to price offering Wednesday
- Company seeking a market value of as much as $4.2 billion
Square IPO: Will Unicorn Status Carry Over to Pricing?
What investors are willing to pay for mobile-payments service Square Inc. in its initial public offering will hinge on how much of a technology premium the company warrants for being a member of the startup “unicorn” club.
The company has the attributes of the so-called unicorns -- those darling private companies valued at more than $1 billion: a celebrity chief executive officer, Twitter Inc. co-founder Jack Dorsey, popular and simple technology, opportunities for expansive growth and big-named venture capitalist backers. Yet by the numbers, Square is akin to a financial company, with 95 percent of revenue coming from payment processing and point-of-sale transactions it executes for customers.