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Square Appears To Be Working On A New Mega-Round From Institutional Investors

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jack dorsey

Here's a highly speculative, but fun story.

It appears as though Square could be working on raising a brand new mega-round from institutional investors.

Owen Thomas of the Daily Dot, and formerly of VentureBeat and Valleywag, noticed Square CEO Jack Dorsey and COO Keith Rabois were in Boston, quickly followed by a trip to Baltimore.

Big deal, right? They're probably always traveling for business.

Maybe, but Thomas points out that Fidelity is based in Boston, and Legg Mason is in Baltimore. Both are big institutional investors.

Thomas reached out to Legg Mason for comment, and the fund-management group confirmed that it was looking into Square.

We circled back to Legg Mason, Fidelity, and Square, but nobody's commenting -- Legg Mason told us they talk to companies all the time and referred us to Square, who said they don't comment on rumor and speculation. But nobody denied it, either.

It sure would make sense.

Square is growing like a weed -- the company is approaching 300 employees, up from less than 40 at the beginning of 2011, and is planning its international expansion this year. Last summer, the startup raised a round of $100 million at a reported $1.6 billion valuation.

See also: Square COO Explains The Death Of The Web And How Square Will Move Beyond Payments

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Square Is Working On A Big Round At A ~ $4 Billion Valuation

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jack dorsey

Square is working on a new big round at a valuation up to $4 billion, says Tricia Duryee of All Things D.

Last week we said Square was likely raising a mega-round from institutional investorsThe Daily Dot's Owen Thomas noticed founder Jack Dorsey making quick trips to places like Baltimore, where asset management firm Legg Mason is based.

Square is a credit card reader that helps merchants accept charges via mobile devices. It's used in restaurants, cabs, and other small business nation-wide. 

Square says it's processing $4 billion worth of transactions annually and $11 million daily (see chart below).

It takes a 2.75% fee when a credit card is swiped and 3.5% plus 15 cents when a card number is manually typed into the device.

10 months ago Square raised $100 million at a $1 billion valuation.


chart of the day square

(Chart from Dan Frommer via Splatf)

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After Missing Out On Buying Instagram, Twitter Considered Buying Another Camera App

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jack dorsey twitter banana phone

Twitter considered buying Camera+, another advanced camera app for the iPhone, after it missed out on buying Instagram, Bloomberg reports.

Twitter had expressed interest in buying Instagram, but Instagram ended up selling to Facebook for $1 billion, The New York Times reported last month.

The talks between Camera+ and Twitter broke down because a majority of the Camera+ team didn't want to move to San Francisco, where Twitter is based, reports Bloomberg. Around two-thirds of the Camera+ staff is internationally-based.

Apparently shortly before Facebook announced its deal with Instagram, Twitter co-founder Jack Dorsey uploaded a photo on Instagram. Then, two days later, started using Camera+ and hasn't used Instagram since.

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Q&A: 15 Things You Didn't Know About Jack Dorsey

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jack dorsey twitter banana phone

Jack Dorsey, the co-founder/chairman of Twitter, was given the Lifetime Achievement Award last week at the Tribeca Disruptive Innovation Awards—at age 34.

After the success of Twitter, Dorsey co-founded Square in 2009. The company allows anyone, anywhere to accept credit card payments on their mobile devices, and more than a million individuals and merchants in the U.S. have taken advantage of it.

After taking the stage after Justin Bieber to accept his award in a freshly pressed grey suit, we waited patiently as Dorsey greeted colleagues and fans, signed autographs for children and posed for photos (Twitpics, presumably) with teenagers.

With no time left for a formal interview, Dorsey allowed me to accompany him as he left the venue and walked several blocks in search of a cab to take him uptown.

He opened up to Business Insider about some personal preferences—from his favorite brand of jeans to which celebrities he thinks best utilize Twitter.

You keep an extremely regimented schedule, what's a typical week?

Sunday is for recruiting and strategy.

Monday is for management leadership and direction.

Tuesday is for product.

Wednesday is for marketing, communications and growth.

Thursday is for external meetings and partnerships.

Friday is for the company.

Saturday I take off.



So what do you do on Saturdays?

Saturdays I usually go for a long walk, a hike with friends, have dinner—it varies.

Sometimes I drive south, that's one of the best things about the Bay area because you can be in this epic nature and feel like you're in a different world, so I do that a lot.



Have you ever played hooky during the work week?

I don't think I ever have.



See the rest of the story at Business Insider

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It's Not Hard To Figure Out Which Startup Twitter Will Try To Buy Next

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Jack Dorsey uses Snapseed

It's pretty easy to tell which startup Twiter will try to buy next: just keep track of which mobile photo-sharing app Twitter executive chairman Jack Dorsey is using at the moment.

For months, Dorsey used Instagram to share photos with his Twitter followers.

And reportedly, Twitter tried to buy Instagram before Facebook swooped in with a billion dollars.

After the Instagram acquisition, Dorsey started snapping photos with iPhone app Camera+.

Then Twitter made an offer to buy TapTapTap, the company behind Camera+. This offer was declined.

Now, Dorsey's Twitter stream is full of photos taken with an iOS app called Snapseed.

It's a pretty safe bet Nik Software, Inc., Snapseed's parent company, can, at the very least expect a phone call from Dorsey.

Will an aquisition happen? Who knows.

It turns out Nik Software was founded way back in 1995 and has a nice business going. From its about page:

Nik Software, Inc. is a privately held company that develops software solutions for the growing digital imaging and photography markets. Established in 1995, Nik Software has become the recognized leader in digital photographic filter development and produces award-winning technology and software products for digital photography and imaging professionals including U Point® technology, Dfine®, Viveza®, Color Efex Pro™, HDR Efex Pro™, Silver Efex Pro™, and Sharpener Pro™ software.

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This App Is So Good It Made Jack Dorsey Ditch Instagram (AAPL)

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jack dorsey

Snapseed encourages you to get grungy with your photos or add some drama to make them pop.

The photo app from Nik Software aims to make photo editing simple and is full of features that let you do everything from selectively adjust portions of the photo, rotate/straighten, center focus to grab attention, and much more.

Snapseed is engaging too, sharing unique photos with others has never looked better.

And tech bigwigs are taking notice. Twitter co-founder Jack Dorsey recently left Instagram and started using Snapseed instead.

Snapseed is available for iPhone and iPad for $5.99. An Android app is on the way.

The app is also available for Mac and Windows for $19.99. 

Tap to open the app.



The app opens to a sample photo, but this is what the main interface looks like.



Seconds later an instruction filter pops up. Tap the upper left corner to select a photo



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Twitter's Jack Dorsey Just Took A Lightning-Quick Trip To New York

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Jack Dorsey Busy

We always watch the comings and goings of Twitter chairman and Square CEO Jack Dorsey with great interest.

Just last month, he tipped us off to Square's plans to raise a huge new round of funding from a couple of big East Coast mutual-fund companies with an unusual trip to Boston and Baltimore.

So what does it mean that he just took a weekend trip to New York to speak at a private school, watch a Yankees game, and dine with fashion doyenne Diane Von Furstenberg?

Yes, Dorsey is bicoastal, with places in New York and San Francisco, but his trips to New York have seemed rarer since he returned to Twitter in an active executive role in 2010. Maybe he's got more time to travel—we recently heard he's backed off a bit on Twitter to focus on running Square.

Here's our theory, courtesy Dorsey himself: "Life is too short not to be direct." So when Dorsey tweets, he's sending a message. We just haven't decoded this one yet. Any theories? Share them, please.

Jack Dorsey always drops hints when he tweets.



After declaring Facebook's IPO "a slow news day," he jetted off to New York.



He took the Virgin America redeye. (Square PR manager Katie Baynes previously worked at Virgin America. Plus it seems like Dorsey's style.)



See the rest of the story at Business Insider

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The Truth About Those Brutal Descriptions Of Working Conditions At Square

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Square CEO, Twitter chairman Jack Dorsey

Over on Q&A site Quora, several former Square employees have posted harsh descriptions of the working conditions at the booming mobile payments company founded and run by Jack Dorsey.

One post concludes: "Many of the employees I know still there are simply waiting to vest, so that their time with the company holds some value. Many have left prior to vesting because it simply is that bad."

The complaints center on a few themes: high turnover, dictatorial management, and disorganization.

The posts have been up for a couple weeks now.  At first, we declined to publish them because the fact is, working at all startups is hard and there are a lot of complainers at almost every company.

But in the intervening days, it's become very clear to us that the posts are getting a lot of attention in the startup scene. A number of influential industry sources have reached out to us to ask questions like, "What the hell is going on at Square?"

So we decided to find out.  

Square PR declined to comment, preferring to take the high road. 

This did not stop us from digging, however. And now, a source close to Square has shared what sounds like a reasonable explanation.

That explanation: In the past couple years, Square has hired over 300 employees, multiplying its headcount. In some cases, the company realized it had hired the wrong kind of person and the relationship did not stick. In particular, Square management believes it may have made the mistake of hiring some people who were not ready for startup life. Some of these employees were described as "big company people." Also over this period, about a dozen people left Square at the company's request – "for cause." It seems to this source that people in those two groups are the ones who are complaining about the company on Quora.

We buy it.

Working at startups is hard. The hours are long. Take-home pay can sometimes stink because so much of the compensation is equity-based. Because startups are doing something new and unproven, their future is uncertain and this can be stressful for people with lower risk tolerance. Because startups have to sometimes change priorities in a moment, projects are invested in and then abandoned.

Finally, working for a founding CEO isn't always pleasant. There is a reason for this. The act of creating a new company takes an incredible amount of passion and energy. The kinds of people who have that much passion and energy – visionary types with the ability to execute – tend to be a little pushy.  

Can you imagine what the Quora threads about working at Apple would have been like if the site had been around back in the early 1980s when Steve Jobs was a humongous jerk to work for? He made people cry ... all the time. He shouted and threw things. Bill Gates was also petulant. Mark Zuckerberg had no problem being ruthless with his cofounders and early executives.

So!

Think about all that as you peruse the following answers to the question "Is Square an unpleasant place to work?"

Here is the most "up-voted" answer from an anonymous contributor:

As a past employee of Square, I will say it was the best place I ever worked, then slowly became the worst. 

The culture is absolutely one of brainwashing with transparency constantly being touted as a tenet, but rarely executed. Most questions that are asked during weekly Town Square meetings have thought-out answers that perfectly fail to address the issues raised. Jack is great at speaking in a compelling way that makes everyone forget what the original question was in the first place. 

Employees are rarely given praise and constantly criticized for any small error. I agree with the post that states employees are constantly reminded of how lucky they are to work for Square, as if they have no qualifications or skills of value. This creates a sense of fear and one that makes employees scared to even bring up issues. 

Ego is another problem as some employees think so highly of themselves, they often forget that they have actual work to get done to be successful. 

The HR process was so shoddy at times it was downright illegal. There is no accountability for management and most have little or no experience with people management leading to employee resentment and surprise-poor management of individuals. This in turn, leads to unhappy teams and due to ego or fear of their own positions, those managers usually target whoever raises issues with their leadership (or lack thereof). 

Basically, you have to keep your head down and take whatever is thrown at you. It really is sad because I truly believe in Square as a product as do the majority of the employees, but Square has lost a significant portion of their talent because they have failed to address these issues. 

Many of the employees I know still there are simply waiting to vest, so that their time with the company holds some value. Many have left prior to vesting because it simply is that bad.

**Update**

My goal in responding to this question was to add my own experience as a past employee and convey the feelings and thoughts of many who express similar experiences at the company. I truly hope that Square addresses these issues and instead of denying the claims or attempting to scapegoat whoever has posted on any of these threads, commits to effective solutions through engaged discussion with the entire company. As I have constantly stated, I love Square. It was hard for me to make the decision to leave mostly because I believe in the product and the potential it has to change the world, but ultimately I had to be happy doing the work I was doing and under those conditions I was not. My biggest concern has always been that Square acquires some of the most talented people, mismanages them and then ends up losing them

Here is a concurring response from another anonymous Quora user:

I was about to write a long post detailing my experiences as well but I think Anon User a couple posts above summed it up quite nicely. Link to post in question:Anon User's answer I'll add my thoughts in any case.

I worked there for about a year and a half and the honeymoon got sour after it started to expand at a ridiculous rate (about 175 new people started in my time there). It had some of the worst growing pains and a nasty habit of hiring inexperienced management. Sadly that continues to this day. As of late, they had someone with barely a few months of management experience heading up management training programs. Yeah.

There is most certainly a circle jerk kind of culture there. They'll convince you you're the luckiest person in the world to be working for an amazing company. For the most part, they are an amazing company, at least when it comes to product design and user experience. Their design skills are top-notch and they're probably the best product in its class. I still use the product occasionally so I certainly don't have any ill will towards the end result. Just the environment they decided to build for the employees.

The work culture is beyond your standard "work long hours startup", Square wants your soul. After voicing my concerns to my manager that the amount I was expected to work was jeopardizing my overall happiness and time spent with my spouse, I was told in no uncertain terms that I could either choose to spend more time on my relationship or Square. There was no middle ground. As you can probably guess, I chose the former. I expect that relationship to last much much longer than Square will be around for.

Jack is a curious CEO, though with little experience running a company. I mean, the guy got kicked out of Twitter. He also works two full time jobs, both as CEO of Square and whatever he does at Twitter nowadays. The company culture comes from top down. When your CEO works two full time jobs, lives within a 4 block radius of both of them, doesn't invest a lot of time in friends, family, or other non-work related relationships, everyone that gets hired below that is expected to do the same. My own social life started to dwindle rapidly in my time there and almost everyone else I spoke to experienced the same. Soon, the only people you would hang out with would be the people you worked with. 

They have an "unlimited vacation policy" but it is seldom taken advantage of. What use is an unlimited vacation policy if you're guilted into not taking any at all when you're already working late hours and often weekends? Even if you were visiting family during the holidays, you were expected to work through that. Not just on call if something was broken, but the same kind of work you would do any other time. It's not like the company was so small there was only one person that could do a specific job, it had definitely grown to the point where everything would be totally fine if someone took a week off. But few did. And those who were lucky enough to do so were met with a very disappointing attitude about it.

Square is a perfect environment for the fresh out of college graduate that has had everything taken care of for them their entire life. They'll give you 3 meals a day and since the only thing you do outside of work is sleep, you can afford an expensive apartment close by, even if their pay isn't quite up to par.

If you don't fit into that or a similar category, good luck! Perhaps you should look elsewhere since this isn't the right place for you.

Here is a counter-point to the above answers, a more balanced answer from Louie Mantia, a former Square designer:

My hiring process is somewhat unique and calls for a different kind of introduction. I simply contacted other designers at Square to see if they would be interested in working together. I met up a few times in the evenings with them and soon enough I was hired as a visual designer (for what was Card Case).

Square has awesome problems to solve. Very complex, tough problems. It's quite appetizing to go and work for them, and the way they portray themselves externally definitely looks great.

And it was great. It was a lot of fun working with the people at Square, and there are some really talented individuals. Having worked at Apple in the iTunes organization for a year and a half, I can say that things are quite different from how a larger company like Apple operates. Square is very much a startup and behaves as one, which has both pros and cons.

Square provides food, beverage, and snack options throughout the day and into the evening, which make it easier for you to stick around and work more at the office. There's a pool table and a bunch of couches and nice chairs to sink into and get things like email tackled (which, by the way, there's a lot). It depends on what kind of pace you're looking to live and how much time you need to devote to outside-of-work activities like friends, family, and hobbies. 

Square is solving almost the same problems again and again, in slightly different ways. Designing the same thing over and over gets a tiring. There was enough for me to do, however, including fun things like artwork for Town Square (its weekly meeting) and movie tickets for company outings. It was more than just being a UI designer, it was being an artist at times.

At Square, there's chances to influence products, though I would say that most of the work done is out of direction from others (like leadership). I became frustrated with Square when I realized that I was drawing things in an attempt to please management/leadership. I wasn't trying to fix things as I thought they should be done. Instead, I was starting to design and think in Square's mindset, not my own. And most times when I voiced my opinion, I was met with conflict. I was constantly prodded to "prove my work" by creating multiple versions of things (which I had done at Apple, but never to the extent I had to at Square).

I don't know how other people work, but while I work, I try to decide what's best and scrap other things. I don't often keep things I don't like.

And though I might have seemed stubborn, I believe that when you hire a creative person, you don't hire them just for their ability to use a certain piece of software, but also for their opinions, thoughts, and guidance.

While at Square I worked on all three of their products: Pay With Square/Card Case, Square Register, and the NYC taxi project. I did rich visual design for every one, and sometimes the things I did shipped. I'm mostly proud of the work I did while at Square, but I'm disappointed with how my time seemed misused. I worked so hard at Square to accomplish very little.

When this became more and more true, I decided it was time to move on and create my own company in an effort to work for many different people, and it's working out very well.

Ultimately, I do not think Square was right for me. It's not to say that it wouldn't be right for you, or someone else. But my overall experience was not pleasant, and not what I wanted in my career.

EDIT: I just wanted to add something else about what I look back on fondly. When I worked at Square, my happiest memories are times spent not working: company movie out at Metreon, Larry King visiting, and having great, casual conversations in cabanas with friends.

Contrast to when I was at Apple, my fondest memories were drawing app icons and interface elements. It sounds weird, but I really enjoy doing that (that's why I made that my profession). And being able to do that for a company like Apple made me very happy, no matter how late into the evening I sometimes spent working on things.

--

I thought a lot about writing this and also thought about posting it with my real name, so I hope you can respect my honesty and openness. Please do not try to read too much into this or make any assumptions based on things I've said. My intention is to have been very honest in the hopes that it adequately answers the question.

Finally, here is a positive review from a current employee, engineer Zach Brock:

This is a challenging answer to write for a few reasons, so here come some caveats. I'm going to do my best to not sound defensive or like an apologist. I will try to give a nuanced, balanced and honest answer to a complex question. I admit that I wouldn't have considered answering if some overwhelming negative answers weren't posted first, but I'm going to try not to let those bias the way I answer. It's really difficult to talk about startups (in particular hyper growth startups) to people who haven't been a part of one, but I'll try to be aware of that.  

Ok, all that being said, let's get started!

Obviously I can't speak for everyone here, but I can talk about my experience and what I've observed. I love working at Square. I get to work with an amazing team of tremendously talented, incredibly smart and extremely nice people. We're building a great set of products that people love to use and building a company from scratch that we want to work at. We've got a huge vision for how and why we want to change the world and we're moving in that direction really quickly. On a more micro-scale, I love the problems I work on everyday, I like the rigor and discipline we apply to problems and I've made a lot of friends in my time here. The energy and enthusiasm in the office everyday is inspiring, the attention to detail and amount of thought that goes into everything we do is incredible and the speed we're moving is exhilarating. I feel like I have a tremendous impact both on the people around me and on the rest of the world. I think the people I work with will all say the same things (and I encourage you to ask them!).  

One of the things I've seen referenced a few times in other answers is work-life balance. In order to work at a startup, I think you need to be more intrinsically motivated[0] than extrinsically motivated[1]. This is why startups are often looking for Hacker-types. The kinds of people who spend all of their free time building something for the pure joy of it are a great fit for the startup lifestyle. These kinds of people put in a lot of time and effort into building things because they enjoy it, not because someone is telling or encouraging them to work harder or longer. If you personally bias more towards extrinsic motivation, you'll probably find a startup difficult. There's not a lot of formal motivation efforts or structure in place. You may interpret it as poor management or a lack of leadership. And that's probably true for you, but not necessarily true for the people sitting next to you.  

All that being said, working at a company going through hyper growth is a tremendously unusual experience both from a technical and an organizational perspective[2]. Not only is your company changing tremendously, but the global context you're operating in is changing as well[3]. On the technical side, Jeff Dean of Google has a great rule of thumb for building scalable software systems: "Design for 10x growth, but plan to rewrite before 100x". The kinds of problems you run into beyond 10x growth are so unknown to you right now that it's not really worth considering them or investing significant time into designing against. Consider a hyper growth startup growing ~25-30% every month. That company needs to rewrite everything every 10 months. That would be difficult if you were just trying to maintain your current functionality, but you're also trying to move as quickly as possible to iterate on your existing products and you might even be trying to launch new ones. It can be unpleasant to do this rewriting and re-architecting. But it's worse to try and operate a system well beyond it's limits. This tension leads to having to make a lot of tradeoffs on the fly and with imperfect information. This can be an disquieting experience for the kinds of people who prefer finding a global optima to a local one. The upside to all of this is that you get to work on a huge number of problems in a very short time frame. You get exposed to different technologies, business domains, product problems and scaling challenges. And as soon as you solve one you immediately move onto another one. It's never boring.  

I'm not aware of a corresponding rule to Jeff Dean's for building organizations, but based on my experiences so far it's probably something like "Design for 150% growth. Maybe. Good luck. You'll need it." People are a lot harder to design for and around than bits and bytes. As a company grows you're going to see all kinds of weird growing pains throughout the organization. Most will be natural and have few consequences[4], some will require explicit intervention to fix[5]. Sometimes you end up with heterogeneous parts of the organization and it takes a little while to reintegrate them into the rest of the culture again. We've grown incredibly fast, we've made a lot of mistakes, and we're likely to make a lot more as we continue to grow. Sometimes making changes leads to unpleasantness; sometimes not changing things leads to unpleasantness. Often times the right solution is only obvious in retrospect. It's a truism that at any given company, not everyone is going to be happy[6]. It's impossible to please everyone in an organization of any size[7]. I think Square's biggest virtue as a company is our ability to identify problems, learn from them and correct them quickly. Rapid adaptability is the only guaranteed way (at least that I know of) to deal with hyper growth.  

Working at a startup isn't just about building a product, it's also about building a company. As anyone who's done it will tell you, building a product is hard. Building a company is also hard. Trying to do both at the same time is incredibly hard. Square is a great place to do both of these things, but it's not always going to be easy and it might even occasionally be unpleasant for some of the people involved. What it is, without a doubt, is worth it.  

[0] http://en.wikipedia.org/wiki/Mot...

[1] Evidence in favor of this: People who have started successful startups and no longer need to work often go on to do another startup. Not because of financial incentive but because they're fundamentally motivated by solving hard problems. 

[2] Surprisingly there's no “Hyper Growth” topic on Quora yet.

[3] Some examples of change: launch of the iPhone, "Facebook" becoming a household word, the rise of AWS, the 2008 housing crisis, Kickstarter getting traction, the launch of Pretzel M&Ms.

[4] I used to sit next to Finance, now I'm across the office. I used to know every time Excel crashed, now I don't.

[5] Support used to know everything we were launching by virtue of sitting next to all of engineering. Then they had no idea when things were changing. Now we have an internal mailing list for user visible updates.

[6] Google, for example, is consistently ranked as one of the best places to work for, but you can find a number of unhappy reviews about them on Glassdoor.  

[7] Well, technically it's impossible to please everyone given a reasonable expenditure of time and money, which puts startups starved for both at somewhat of a disadvantage.

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Twitter Cofounder Biz Stone Is Publishing A Book About What He's Learned From The Tech Industry

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Biz Stone

Biz Stone, cofounder of Twitter, has signed a deal with Hachette's Grand Central Publishing to release a book in April, 2014.

According to Mediabistro, the book is called Things A Little Bird Told Me and will detail Stone's experiences and lessons he's learned working in the tech industry and helping to start Twitter, and more recently, The Obvious Corporation.

In a statement about the book, Stone said, ""I've found that my experiences resonate with a very wide array of individuals at different stages in their lives. I'm excited to create a physical artifact to share the lessons I've learned."

This will be Stone's third published book, but the first one he's written since Twitter launched back in 2006.

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Twitter's Estranged Cofounders Are Finally Talking To Each Other Again

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Jack Dorsey and Evan Williams

Just last week, Twitter cofounders Ev Williams and Jack Dorsey had dinner together—and exchanged friendly tweets about the menu at Aziza, a Moroccan restaurant in San Francisco.

If there ever was a time when you should care about someone tweeting what they had for dinner, this is it.

That's because Dorsey and Williams, last we heard, were barely speaking on terms.

Williams, after all, ousted Dorsey as Twitter's CEO in 2008 and replaced him.

"It was like being punched in the stomach," Dorsey told writer David Kirkpatrick.

Dorsey dramatically returned to Twitter in the fall of 2010 as executive chairman and de facto head of product, after Williams stepped down as CEO. (COO Dick Costolo replaced Williams.) At the time, we heard Williams wasn't pleased with Dorsey's return. 

There have been earlier signs of a rapprochement. Dorsey and Williams agreed to appear together in a photo shoot last year for Condé Nast Traveler. (Williams, once the star founder, barely rated a mention in the writeup.)

Perhaps time—and Twitter's quiet business success—has healed the relationship's wounds. 

And perhaps it helps that the two aren't jockeying for control over Twitter, now solidly in Costolo's hands.

Dorsey's focus now seems to be on his job as CEO of Square, his payments startup, and one source familiar with Twitter's inner workings told us he thought Dorsey had pulled back some on his day-to-day involvement at Twitter.

Then again, we recently spotted Dorsey meeting with new Twitter communications chief Gabriel Stricker at a high-end tea shop in SoMa—which hardly suggests the famously workaholic Dorsey has flown the nest.

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Square's Next Move Might Be An Android Cash Register

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No Sale Cash Register Till Sale Shopping Budget Cutting Back RecessionFor a company that's often been compared to Apple, Square is hiring an awful lot of Android engineers lately.

"Just realized we have a new Android engineer joining Square every Monday for five weeks in a row!" tweeted Eric Burke, Square's manager of Android engineering on Monday.

Square CEO Jack Dorsey retweeted Burke's message—his way of signaling that the Android push was a corporate priority for the payments startup.

Burke, who created an Android-specific algorithm to let Square's iconic card reader send credit-card data to Android devices, was also featured in the company's blog on Friday. No coincidence there.

So we get it. Square really loves Android lately and is hiring folks who feel the same way.

What will these engineers work on? Square already offers a basic app which lets Android users take payments on smartphones. But it doesn't have an Android version of Square Register, which turns a tablet into a full-fledged cash register capable of tracking sales.

A Square spokeswoman pointed us to a March story in USA Today which stated "Square has no plans at this time to launch a version of Square Register for Android." But that was March—and that was before Square hired all these Android engineers. It's hard to imagine they're all going to sit around tweaking Square Card Reader.

While Android has a tiny share of the tablet market, it's growing. And a small Estonian startup, Erply, has beat it to market with an Android point-of-sale app designed for tablets. (You may not have heard of Erply, but it's backed by Index Ventures, a venture-capital firm which funded Skype, Etsy, and Dropbox, among others.)

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Jack Dorsey Is Backing Away From Twitter

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Jack Dorsey

The tech world's most famous multitasker since Steve Jobs is easing off one of his two jobs.

Two sources have told us that Jack Dorsey, Twitter's executive chairman, has been spending less time at the message-broadcasting service and more as CEO of Square, his payments startup.

The way he told it, since Dorsey staged a triumphant return to an active role at Twitter, he spent eight hours a day working there and eight working at Square. We haven't gotten details yet, but we understand the ratio has shifted decisively in Square's favor.

We think this makes sense. At Twitter, he has a strong CEO in Dick Costolo, who has steadied the ship after a long stretch of turmoil.

While Square COO Keith Rabois is increasingly the face of the company in the press—especially when it comes to trash-talking the competition—Dorsey is a super-hands-on CEO there.

He even marches new Square hires from a statue of Gandhi on San Francisco's waterfront to Square's offices in the San Francisco Chronicle building downtown as part of orientation. And while he remains an avid Twitter user, he most frequently uses it to promote small businesses using Square.

And in the face of increasing skepticism about tech startups after Facebook's disappointing IPO, Dorsey needs to get back to business there—crucially, raising a long-rumored megaround from institutional investors.

Dorsey will need every waking hour—and he spends a lot of time awake and working—to persuade them. Expect more trips to the east coast.

That said, Dorsey is still clearly involved with Twitter's top executives. We stumbled across him meeting with new PR chief, Gabriel Stricker, just the other day.

We asked Square and Twitter for comment on how Dorsey was splitting his time and didn't hear back.

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How To Eat Like Twitter's Cofounders On The Cheap

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Mourad Lahlou of Aziza

A company called Kitchit brings celebrity chefs like Mourad Lahlou and Traci Des Jardins to private homes.

Now Klout, the online influence tracker, is offering a big discount—up to $500—on Kitchit's services.

Lahlou's Aziza, a Michelin-starred Moroccan restaurant in San Francisco, hosted Twitter cofounders Jack Dorsey and Ev Williams for dinner last week.

Des Jardins' Public House is a hot spot by AT&T Park in San Francisco's startup-drenched SoMa neighborhood.

These aren't the kind of chefs you'd normally be able to get catering a dinner at your home. We've also heard that Kitchit is very popular with some very high-ranking Googlers and the early-Facebook-employee crowd.

Kitchit recently expanded its rent-a-chef program to New York, too.

Unlike some past Klout promotions, the discount isn't limited to people with high Klout scores—but the higher your score, the bigger the discount.

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JACK IS BACK AND FORTH! Where Twitter Founder Is Nesting

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jack dorsey twitter banana phone

We just reported that Jack Dorsey, founder of both Twitter and Square, was spending significantly less time on Twitter and more on Square, his payments startup.

Now AllThingsD's Mike Isaac is knocking down that story, saying Dorsey "remains the visionary in the head of product role." Well, okay—but we never said he'd stopped being that.

So which is it?

We now hear that broadly speaking, our first story was right—compared to late 2010 and 2011, Dorsey has spent a lot less time at Twitter this year.

But about three weeks ago, Twitter internally made a big fuss about how "Jack is back!"—back again, that is, but nowhere near as dramatically as when he returned from exile in 2010.

Even with this sort-of return, he's still spending more time on Square—which is a change from the times when he described his 16-hour days as split evenly between his two companies.

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10 Things You Need To Know This Morning (FB, AAPL, GOOG)

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Here's Who Might Buy Square If It Can't Raise $250 Million (AMZN, GOOG, AAPL, EBAY)

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jack dorseyIf Square had to sell right now, who would it sell to?

cool thread on Quora about potential suitors for Square, a mobile payments startup run by Twitter cofounder Jack Dorsey, popped up over the weekend to answer this question.

The original questioner said several sources are saying Square is having a tough time raising money in its upcoming funding round.

An earlier New York Times report said Square was seeking $250 million at a valuation between $3 billion and $4 billion—but that was before Facebook's big flop.

Now there's a big list of sensible acquirers, which we've included below.

One thing to note first—we have no idea who the author's sources are on Square's fundraising attempts. So any notion that Square is having trouble raising money is purely scuttlebutt for now.

Here's Quora's list:

Tier 1 - Clear fits if Square were for sale
Apple - Opportunity to vertically integrate the hardware and get even broader distribution as well as build a payments product with a "Apple" experience. Apple needs additional payments capabilities to do this (iTunes is a retailer of apps, not a payments system)

Google - Opportunity to reset Google Wallet and deeply integrate Ads / Offers into Square

PayPal - Opportunity to dramatically expand their offline strategy (now just a few large merchants with minimal usage) and cement PayPal as the Visa/MC competitor by tying PayPal accounts with "Pay With Square" Not a great buy vs. build tradeoff on Square's basic card acquiring business.  

Visa / MC - Big enough to pay up.  Conflicts with some of their acquirers but that ship has already sailed for Visa with the Cybersource acquisition.  Very valuable to control threat of Square disintermediating card payments over time.  

Tier 2 - Plausible but a stretch
AmazonAmazon loves low-margin disruptive businesses (bookselling, AWS) but probably would have joined this race already if they really wanted to.  

Amex - Not able to pay a premium price now that it is a bank holding company and subject to bank holding company rules.  Too dilutive to do a stock transaction.

Facebook - Has the ability to pay hasn't been making big moves into payments, especially offline.  Credits is a pretty limited use case.  

Intuit - Strong strategic story but not a great buy vs. build fit given that it already has GoPayment.  

Twitter - Consolidate Jack Dorsey's companies into one.  Increase commerce component of Twitter monetization.  Would be an all-stock deal so difficult for boards of both sides to value the transaction.  

Verifone - Great strategic fit, but very bad blood between the companies

Tier 3 - Huge stretch
Bank acquirers (Chase Paymentech, BofA Merchant Services) - Parent companies are [regulatory] capital constrained

FirstData - Great strategic fit however its a private equity owned and has tons of debt thus unable to pay

Monoline Acquirers (Vantiv, Heartland) - Great strategic fit, but not big enough to pay up for Square

Verizon/ATT/T-Mobile/Sprint - Already doing ISIS as a consortium.  Not strategic enough for any one of them to buy alone.  

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Square Has A New CFO, And She Better Get That New Financing Round Nailed Down

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Sarah Friar

Square, Jack Dorsey's payments startup, just hired its first chief financial officer—Sarah Friar, formerly a top executive at Salesforce.com.

Friar is a big believer in cloud services like Salesforce.com's business-automation software and Square's payments network—so much so that she left an analyst job at Goldman Sachs to join Salesforce.com.

It's a little weird for a financial-services firm to have gotten by so long without a CFO. Until Friar's hire, Square only had a VP of finance.

In Square's early days, venture capitalist Gideon Yu served as the company's shadow CFO, working one day a week—until he left Khosla Ventures last year to join the San Francisco 49ers football team, where he's now president. (Khosla founder Vinod Khosla took over his seat on Square's board a few months after Yu left Khosla.)

Now Friar has a big challenge on her hands: She needs to wrap up Square's next big financing round.

In April, CEO Jack Dorsey and COO Keith Rabois took a trip to the East Coast—to Boston and Baltimore, which happen to be where big mutual-fund companies Fidelity and Legg Mason happen to be based. They were reportedly seeking a $4 billion valuation.

Even before the Facebook IPO flop, that seemed pricey.

But in announcing Friar's hire, Square also mentioned that the company is now processing payments at an annual rate of $6 billion. That's up from a $5 billion a year rate in April—a huge 20 percent leap in two months.

Translation: Square is growing like a weed, and its prospective new investors had better get on board the train.

We'll see if they buy it.

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REVEALED! Here's Who Owns How Much Of Square

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Square CEO, Twitter chairman Jack Dorsey

Jack Dorsey's payments startup, Square, has just hired a CFO and it's in the hunt for a reported $250 million round of fresh financing that would value it at anywhere between $2.5 billion and $4 billion, according to who you talk to.

(Guess what: Sources close to Square are highballing it. Sources close to the mutual funds and other private-equity players it's hitting up for cash are lowballing the number. Welcome to the world of price negotiations.)

Square's last round, almost a year ago, valued the payments startup at $1.6 billion.

Even if Square hits the lower valuation figures being talked about, insiders and investors are going to win big. And now we know roughly how big.

Square does business all over the United States. So it has to register as a "foreign corporation" in most states.

In October 2011, it filed to do business in Alaska, Justin Byers of VC Experts, a private-company research firm, pointed out to us. That filing listed its officers, directors, and major shareholders.

The big surprise: Dorsey, the CEO and cofounder, owned less than 30 percent of Square as of October 2011, according to the filing.

In this day and age, we're used to founders having big, controlling stakes. But remember, Dorsey was not in the same position of power he holds today as executive chairman of Twitter and CEO of Square. He'd been cast out of Twitter by cofounder Ev Williams, and while he was titular chairman, he wasn't welcome at the office.

So to get Square's funding, he had to give a big chunk to the venture capitalist who was willing to take a bet on an outcast: Gideon Yu, then with Khosla Ventures. Khosla and the other Series A investors took a big, 25 percent stake in the company at a valuation of $40 million—and Yu made sure Khosla got most of that.

By the way, we also know that other Series A investors are still valuing Square at roughly $1.6 billion.

How do we know this?

Palantir founder Joe Lonsdale's Formation 8 is raising a new fund and is advertising its partners' track record—including a return on investment on Square that has returned 30 times the initial investment. (Formation 8 did not invest in Square, but some of its partners did at previous firms.)

We know that JP Morgan Chase and Sequoia invested. They had just over 5 percent apiece in October 2011.

These filings normally list all shareholders who own more than 5 percent of a given company.

Kleiner Perkins, which invested in Square's 2011 round and recently hired Square's director of products, Megan Quinn, as its newest partner, did not make the cut.

We asked Kleiner to confirm it owns less than 5 percent of Square, but haven't heard back yet. The math on the financing round, though, suggests that it's almost impossible for Kleiner to have gotten more than 5 percent of the company.

Kleiner partner Mary Meeker has a seat on Square's board. But at less than 5 percent, even if Square gets its highest possible valuation, the math doesn't work for Square to be a runaway hit for Kleiner. Kleiner simply doesn't own enough of the company for its investment to move the needle on its $1 billion Digital Growth Fund which Meeker runs.

When we first asked Square about the numbers in the filing, they told us they were incorrect. Spokesman Ricardo Reyes declined to elaborate further. More on that later.

Here's the chart:

Square ownership, October 2011

UPDATE: This article has been corrected to note that Formation 8's partners, not Formation 8 itself, invested iN Square.

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We Hear Twitter Cofounder Jack Dorsey Now Lives In A $10 Million House

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Jack Dorsey's Seacliff house

Twitter and Square cofounder Jack Dorsey is the mysterious owner of a house on El Camino Del Mar in the exclusive Seacliff neighborhood of San Francisco, a well-connected source in local real estate tells us.

SocketSite, a real-estate news site, reported that the house sold in February in a private transaction after being withdrawn from the local multiple-listing service.

As Curbed SF noted, the house is the most expensive two-bedroom in the city, even after the price had been reduced from $18 million to $9,990,000.

It has a stunning view of one of Dorsey's fascinations, the Golden Gate Bridge. He actively participated in celebrations around the 75th anniversary of the bridge's construction, and in May, he took all of Square's 330 employees on a walk across the bridge, which he called a "spectacular influence on all I do."

A Vanity Fair profile of Dorsey last year mentioned his "austere" Mint Plaza apartment located mere blocks from the headquarters of Square and Twitter. But he sold that unit for $1 million in early March, according to public records which identify him as the registered agent for an LLC under which he owned it.  

He was more careful in buying his new house, which is owned by an LLC whose registered agent is Audrey Scott, a lawyer at Cooley LLP who specializes in counseling company founders on wealth management and estate planning. 

Reached by phone, Scott said, "I can't discuss client matters" and hung up. Press representatives for Square and Twitter did not respond to request for comment.

One question: Where did Dorsey get the money?

As we reported last week, Square filed a document with state regulators in Alaska saying Dorsey owned 28 percent of the company, which was valued at $1.6 billion in its last financing round.

Square and Twitter are both privately held. And both companies have taken steps to prevent unauthorized sales of their shares on secondary markets. But Twitter's board—Dorsey is the chairman—could well have authorized the sale of some of his stake.

Dorsey, a committed urbanist, owns a BMW, according to Vanity Fair, but he doesn't seem to be using it to commute. Instead, he tweets about the books he reads while on the bus. Google Maps says it's a 48-minute ride.

That longer commute fits with something else we've heard: Dorsey, who once said he spent eight hours a day at Square and eight hours a day at Twitter, is spending less time at Twitter these days. (His time split changes, and he's been very involved with Twitter's move to its new office.)

Last month, Dorsey quoted Pablo Neruda: "I need the sea because it teaches me."

Now, it seems, he has his teacher.

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10 Things You Need To Know This Morning

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microsoft surface tablet

Good morning! Here's the news:

  • The tablet will come in two models, one that runs the full-featured version of Windows 8 and one that runs the "Metro" version of the operating system. Here are the specs sheets for both.

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