What makes him powerful: Exactly when does Jack Dorsey sleep? While not the most powerful executive in mobile, he is almost certainly its busiest: Not only does Dorsey head up product development at Twitter, the microblogging juggernaut he created in March 2006, but he also serves as CEO of Square, the fast-growing mobile startup that is revolutionizing credit card payments and processing.
First unveiled in late 2009, Square enables users to accept credit and debit card purchases anywhere and anytime via iPhone, iPad or Android smartphone. Sellers simply input the transaction total, swipe the consumer's credit through a small dongle that plugs into the device's audio input jack, and Square handles the rest. There's a flat 2.75 percent transaction fee for all swiped Square transactions, with a 3.5 percent plus 15 cents charge when transactions are manually keyed in. And that's it--there are no additional activation costs, recurring charges, early termination penalties, hidden fees or other obstacles that have historically blocked small businesses and the like from accepting credit card transactions. "Payments have a lot of friction, a lot of distraction," Square COO Keith Rabois recently told Bloomberg. "We can't eliminate all of that this month, but our mission is to make Square ubiquitous."
Square isn't ubiquitous yet, but it's getting there. The startup is now processing $2 billion in transactions each year, with merchant signups topping 800,000, up from 500,000 in May 2011. (By comparison, credit card giants Visa and MasterCard have authorized a combined 8.2 million merchants.) Available for free via the web, the Square dongle is also sold for $9.95 at roughly 200 brick-and-mortar Apple (NASDAQ:AAPL) Store locations as well as Target RadioShack and Best Buy outlets--in late October, Square additionally announced it will sell dongles at Walmart stores across the U.S., bringing the number of retail outlets offering the product to more than 9,000.
Square's rapid growth and expanding retailer reach pose serious questions about the future of the Near Field Communications-based, tap-and-pay mobile commerce networks once expected to dominate the mobile payments ecosystem. In mid-September, Google (NASDAQ:GOOG) officially launched its NFC-based Google Wallet, which allows consumers to make purchases by tapping their smartphone at MasterCard PayPass-enabled merchant terminals; for now, the service is limited to a single device, Sprint Nextel's (NYSE:S) Android Nexus S.
Isis--the forthcoming nationwide NFC network spearheaded by Verizon Wireless (NYSE:VZ), AT&T (NYSE:T) and T-Mobile USA isn't slated to begin commercial trials until 2012. But Square services are already live across the country and across multiple devices, requiring none of the point-of-sale hardware integration and smartphone manufacturer support that threaten to slow NFC's progress. NFC is still gathering steam, but Square is moving full speed ahead.
Square's success underscores Dorsey's greatest talent: He makes complex ideas and technologies universally accessible. Twitter and Square are not only revolutionary concepts, but both are models of elegant simplicity--Twitter demands that users keep their thoughts short and sweet, limiting all tweets to 140 characters (the same number of characters in a standard text message), while Square whittles payment processing systems to nothing more than a dongle and a smartphone. Both are solutions that didn't even exist a few years ago, and now millions can't imagine life without them. It's no wonder so many Silicon Valley insiders are projecting Dorsey as the next great entrepreneurial icon--he's already changed the way we live (twice, no less), and it seems likely the best is still to come. --Jason