Square is raising money at it tries to compete with Apple and the soon-to-be spun off PayPal.
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By Laura Lorenzetti
October 6, 2014

Square, the mobile payment start-up, recently landed $150 million in venture capital funding, in a deal that values the company at some $6 billion.

The latest Series E financing round was led by the Government of Singapore Investment Corporation, a new investor for the payment company, reported the New York Times. Goldman Sachs (GS) and Rizvi Traverse Management also participated in the round. Both had previously invested in Square.

The funding follows a filing by the company last month that stated it had raised half of a possible $200 million investment round, as reported by Fortune.

Square’s multi-billion valuation puts it the same league as other standout start-ups like Pinterest and Spotify, which also have valuations of between $5 billion and $6 billion.

A Square spokesperson would not comment directly on the financing, but said the company stands for “independent businesses and will continue to invest aggressively to empower them with tools that help them grow.”

The new financing round comes as the world of mobile payments adapts to the presence of a big new competitor in the shape of Apple Inc. (AAPL), whose new iPhone 6 carries the company’s new Apple Pay product. Apple Pay uses Near Field Communication technology that allows for “proximity payment.” The iPhone 6 owner only needs to hold their phone close to a receiver at participating retailers to transmit payment.

That’s not the only competition Square faces in the payment market. Ebay (EBAY) announced that it will spinoff PayPal in an effort to make both of its businesses more competitive, and Amazon.com (AMZN) introduced its own credit card reader similar to Square last year with especially low processing fees.

All three rivals have better access to funding, and Square has been beefing up its offerings–and fundraising–to compete better. The company unveiled a new cash advance program for small businesses in May called Square Capital and purchased a food delivery start-up called Caviar.

Square is also building out its technology to work with the more secure E.M.V. microchip technology, which is on track to become the industry standard, and plans to accept Apple Pay transactions. E.M.V. is backed by Europay, Mastercard and Visa, three of the world’s payments giants.

 

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