In this series of blog posts looking at exciting innovations in the market, we turn this week to the dynamic start-ups that are breaking new ground in their respective territories.
An innovator for our time
Rarely is a generation graced by a man who can lay claim to two ground-breaking inventions.
35-year old Jack Dorsey of St. Louis, Missouri is our generation’s man. His first is known to us all, Twitter, which he co-founded in 2006.
The second is less well-known and less sexy, but holds the potential to redefine an entire category and revolutionise the way that businesses accept payments from their customers.
Dorsey’s latest venture, Square, is a company that processes credit card payments for businesses.
Like all successful innovations, Dorsey’s invention of the Square card reader in 2010 originated in a desire to solve a customer pain point. When employed as an intern by entrepreneur Jim McKelvey, Jack was told a story by his boss that stuck in his mind. Jim told Jack how he had lost a sale worth $2,500 because his customer could only pay by card and his business couldn’t afford a credit card payment system.
This set Jack on a mission – to devise a fast, easy, secure and affordable solution for small businesses who couldn’t afford conventional card payment systems.
Square’s card reader is a small dongle that plugs into the earjack of an iPhone or an Android-based device, and enables businesses to accept credit card payments simply through swiping a customer’s credit card through the card reader. The device costs $10 and there is no monthly fee for users. Square takes a 2.75% commission of every sale.
By June 2012, Square was already processing more than $6bn a year in payments for two million individuals and small businesses. Not only have small businesses jumped on the convenience and speed that Dorsey’s low-cost innovation brings, so too have big companies. Last month, Starbucks announced it would start processing card transactions through the company and pledged a $25m investment in the pioneering start-up.
Dorsey’s success lay in his ability to identify a pain point and use technology to solve it. He had a clear understanding of what his customer wanted – a solution that was quick, convenient and affordable.
Like many great innovations, the genius lay in its simplicity.
This entry was posted on Wednesday, 12 Sep 2012 at 4:30 pm and is filed under General, Innovation.
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