Square drops ballast before IPO: Wall Street auditors rated the company 30% lower than in October

Shares of Square payment service at the finish line before the IPO, experts estimated at $ 11– $ 13. This will be the price corridor of shares on the New York Stock Exchange. The company's capitalization is estimated at $ 4.2 billion.

The company itself sells 25.65 million shares. Another 1.35 million papers are to be implemented by the Start Small Foundation charitable foundation founded by Jack Dorsey. In case of increased demand for securities, Square will sell another 4.05 million shares. The company expects to raise more than $ 403.7 million.

Square, founded by Jack Dorsey, creator of Twitter , raised $ 590 million from venture capital investors, including Goldman Sachs and Rizvi Traverse Management . “Megamind” wrote that in October, experts estimated Square at $ 6 billion. Although the estimate was then higher, the company planned to raise a smaller amount - about $ 275 million.
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Source: eugenyshultz.livejournal.com

“Square grew quite well, and at earlier stages a high score was justified,” said Sergey Azatyan, co-founder and managing partner of the venture fund Inventure Partners . According to him, about a third of technology companies receive higher marks during the last private round than during an IPO. “Investors of the last rounds have different mechanisms that protect their investments, and in the event that an IPO occurs at a lower price, they, in fact, charge the shares, ” Mr. Azatyan explained to Kommersant.

Judging by the statements of experts, the decrease in the assessment will not adversely affect the affairs of Square and its investors, and perhaps even benefit. In any case, the company's appetites are growing: it plans to sell more shares and raise an amount that is almost 1.5 times higher than what it originally stated.

Square plans to send part of the funds received to replenish working capital, and also uses them for general corporate purposes. In addition, part of the money can go to the purchase of "complimentary" businesses, technologies and services.

Square offers a platform for accepting bank cards on mobile devices. Payment terminals suitable for iOS and Android smartphones are used by street food vendors, taxi drivers and coffee shop owners.

Square's plans for IPO became known in July 2015. The company used the US law on support for startups - according to this law, a company with annual revenues of up to $ 1 billion may not disclose details of its work to an IPO. Among the 10 underwriters of this placement are Goldman Sachs , Morgan Stanley and JP Morgan Securities .

Square company is 24.4% owned by Jack Dorsey. He is currently the CEO of Square and Twitter at the same time, and after the initial public offering of Square shares, he will be the head of two public companies. For Square this is a risk, since Dorsey will have to sacrifice time in favor of either of the two companies.

In the nine months ended September 30, 2015, Square's total net revenue was $ 893 million, which is 49% higher than the same period last year. Gross income for the same period increased by 65.4%, to $ 261 million. Square's net loss was $ 131.5 million and increased by 12%.