Peter Ha for TechCrunch:
Beginning this fall, Square will begin processing all U.S. credit and debit card transactions at participating Starbucks stores across their 7,000 locations. Pay with Square users will be able to find a nearby Starbucks in the Square Directory from their iPhone or Android smartphone. Additionally, Starbucks will be investing $25 million in Square for the company’s Series D financing round, which clocks in at a $3.25 billion valuation. (Just shy of the $4 billion valuation we’d been hearing about.) Howard Schultz, CEO of Starbucks, will also be joining Square’s Board of Directors.
Square enables anyone to process credit or debit card transactions using a small square dongle that attaches to the headphone jack of your mobile device, and accompanying software. The company currently counts 2 million merchants and about $6 billion in annual sales.
The addition of “Pay with Square” support for Starbucks means customers won’t have to swipe credit cards at all to purchase their venti latte – instead they can use the Pay with Square app on their iPhone or Android phone just as they do with other “Pay with Square” merchants – an alternative to the “Mobile Pay” feature on the Starbucks iPhone app.
Square’s made leaps and bounds since its introduction, but Starbucks is by far the highest-profile organization to adopt Square as a payment method – it’s a move that’s almost certain to propel the company into mainstream acceptance in a very significant way.