Square operates in the mobile payment market primarily in the US. The participants in the market are trying to provide their customers with an easy way to make payments in store with the use of credit cards or mobile phones or any other means. Previously, it was the financial institutions that determined which technology to use, however nowadays the competition within the market is high and many different approaches to mobile payments have emerged leaving a high uncertainty on which of the market players will survive in the long run. Consumer demand for easy access to their money through electronic wallets has grown exponentially, and consumers will soon expect mobile money to be accepted almost everywhere. Competition in the market is based on practicality, convenience and fee structure. Many of the current payment systems require stores and merchants to pay high fees in order to allow their customers to pay by credit card or other non-cash payment options. Many of the small organizations cannot afford these kinds of fees and don’t offer mobile payment systems yet. I believe Square should heavily focus on that segment of the market. As the competition is immense and competitors like Paypal and Google have more potential to attract the big corporate players, specializing in small businesses allows Square to avoid the high level of competition and to survive in the long run. There is a big market, up to 26 million American small businesses, that are not benefiting of mobile payment yet, allowing Square to further grow organically. They will be able to offer cheaper solutions such as their Business-in-a-Box products to their customers that make it possible for these customers to enter the market and to only pay a reasonable fee for it. In regards to international expansion, I believe it is hard to gain market share in Europe or other overseas countries by an organic approach. In order to expand to these markets they would need to enter into a strategic partnership or an acquisition of their respective counterparties overseas. However, I would recommend to first expand in the local market and to look at overseas options in a few years when the organic local growth is exhausted. From a shareholders perspective, there are a few risks that need to be considered. First, as mentioned before, competition is very high and it is unsure which technology offered will be accepted by the market and which will not survive. Given that Square is a relative small player compared to the other organizations in the market and that there is nothing proprietary in their product, organizations such as Google or Paypal could easily squeeze them out of the market if they decide to compete for the same segment. Furthermore, there is always a risk in regards to privacy and data theft in that business. If ever there was a data breach in their database or system they would be out of the market and the stock value would crash. I recommend a hold position.