Square has lost at least $20 million as a result of its partnership with Starbucks in 2013, according to a report in the WSJ.
In 2012, Starbucks invested $25 million into the start-up and Square was able to process its credit card transactions. However, Square’s fee on each Starbucks transaction was only 2 percent last year. The company usually charges 2.75 percent.
But even with the low percentage, that still doesn’t explain how Square recorded a loss of $100 million. Sources told the WSJ that the company has used more than half of the roughly $340 million it has raised in venture capital.
Despite the loss, a Starbucks representative told Geekwire that they are still working with the start-up.
“Square remains an important strategic partner for Starbucks and we continue to partner together on initiatives stemming from our original agreement,” the rep said.
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