Fox Business is reporting that Square has postponed its IPO indefinitely because it is not ready to go public. After meeting with NASDAQ officials as late as Q4 2013 and having discussions with investment banks, it seems the company is having problems with its “revenue run rate.” Supposedly Square generated $100MM revenue in 2013 but is still unprofitable. The article quotes one person close to the situation that said,
“Square’s private-market valuation could not be substantiated by their revenues as a public company.”
So after raising capital at a $5Bn valuation, it seems they would not be able to achieve that valuation in the public markets.
The full article by Katie Hoff can be found here.
More to come…