Says who? Growth is great, but it doesn't necessarily mean that profits are in the pipeline (e.g. Groupon).
And on top of that, what exactly is it that Square does that it's going to be profitable on? Is it the Point of Sale devices? Is it their Square Readers? Is it their small-business loans? They're not a terribly focused company, and maybe that's a reflection of their CEO doing double-time (completely speculation on my part).
Personally I see this as their last-ditch effort to grab some cash, to exit before the market gets worse. Their investors don't want to be left holding the bag when the IPO market gets cold, so it's better to cash out now while the name Square is worth something than to bet that they'll get bigger/better in the future.
We read about them because... I'm not too sure actually, I guess it's because they are burning VC money and have a splendid website.
As someone who uses other people's payment systems, Square makes me happy. It's a product that respects the users.
But too bad we don't actually make them money.
Really complex retailers with broad product lines, like supermarkets and big box retailers, will continue with highly customized in-house solutions. But for retailers with only dozens or hundreds rather than thousands of products, and limited budget to buy fancy solutions, it's a godsend.
And, because the customers are making a major, high-risk, customer-facing commitment, they're going to be very sticky, very unlikely to switch. Basically, Square is entering a market where the established players are too slow and coarse-grained to reach a lot of potential customers, and then they'll have a terrific barrier to entry. That sounds like a good deal to me, from an investment point of view.
Some citations would be nice
It's betting on a future, and the future is unpredictable.
"Too Big To Fail" is not the terminology I would ever want towards something I develop - I think Titanic.
I understand that businesses do not start out profitable from the get go, but $700 million in debt?
Edit: Here's First Data's S-1:
http://www.sec.gov/Archives/edgar/data/883980/00011931251533...
In 2012, they lost $85m. In 2014, they lost $154m. How much bigger are were they in 2014 relative to 2012? If it's more than 2x (and I have no doubt it is), they're on the right track. If they're 5x bigger, they're doing fantastic - revenue growth is outpacing red ink growth by a healthy margin. That means sooner or later, they'll not only be profitable, but tremendously so.
Square is a category-killer, in a key category.