Square buys startup Caviar for $90 million, to start delivering food?
Mobile payments firm Square has purchased food delivery startup Caviar, both companies have confirmed.
San Francisco-based Caviar launched in 2012 and is a lot like Seamless or Eat24 or GrubHub, only it is known for providing delivery services for restaurants that don't normally deliver to customers. Despite charging a steep delivery fee compared to other delivery websites, the service is quite popular in US metropolitan areas like New York City, Boston, Chicago, Los Angeles, etc, where it provides features like real-time GPS tracking.
Square, which most recently announced a Europe-friendly chip card version of its card reader, announced through its blog that the acquisition would deepen its commitment to "providing independent sellers with services that make it easier for them to grow their business". Jack Dorsey, CEO of Square, further said in a statement that "Caviar's curated, seamless delivery experience is exactly the kind of service we want to provide buyers and sellers."
Caviar has listings for "hundreds" of restaurants across six US states, and according to Square, order volume has grown more than 500 percent year over year, while 80 per cent of monthly deliveries are to repeat customers. Although terms of the deal haven't been announced, both Recode and The New York Times reported the acquisition would be an all-stock transaction valued at about $90 million.
It's not immediately clear how Square will incorprate Caviar into its business, but the company is likely trying to explore alternative and successful ways of generating revenue beyond the Square card reader, especially since it discontinued the Square Wallet app earlier this year.
Also, Caviar isn't going anywhere at the moment. It has said everything you love about the service will "remain the same".