In 2009, Twitter was at its height of market impact. Facebook was gaining strong traction around the world, but Twitter was the darling of the social media world. Everyone from pro athletes, to celebrities, to the President of the United States was engaging in 140 character dialogue back and forth with friends, acquaintances, and even strangers. Twitter literally revolutionized social media and modern communication.

But that just wasn’t enough for Twitter co-founder Jack Dorsey. Dorsey was the mastermind behind the formation and rise of Twitter, but in 2009, when Twitter was just hitting its peak, he had another idea. He quietly went to work launching Square, Inc. out of his San Francisco loft apartment in 2009.

The Idea

Dorsey’s idea to start Square, Inc. was not intentional. As the CEO and founder of Twitter, Dorsey had plenty of stuff on his plate. It wasn’t that he needed a job or was simply sitting around all day dreaming of how he could revolutionize another industry. Instead, it was a practical, real-world problem.

In early 2009, Dorsey’s close friend, James McKelvey explained to Dorsey that he had to pass up a $2,000 sale of one of his glass products because he could not accept credit card payments. An idea struck Dorsey, and he immediately set to creating a working prototype of Square. Once Dorsey proved the prototype could solve McKelvey’s problem by allowing small business owners to accept credit card payments via a mobile device, Dorsey launched Square, Inc. in late 2009 with 10 employees. By late 2012, Square had grown to a market value of $3.2 billion and over 400 employees.

Continued Innovation

As an innovative entrepreneur on the cutting edge of the tech revolution in San Francisco, Dorsey is continually testing the boundaries of the mobile payments industry by playing with the model and introducing various new payment models.

In August 2012, Square announced it would offer the first ever flat monthly fee payment model for small businesses. Instead of paying a small percentage on every transaction, small businesses could simply opt to pay a flat monthly fee of $275. For thousands of small businesses this translated into savings of hundreds, if not thousands of dollars per month.

In December 2012, Square made another move. Beyond accepting credit and debit card payments, Square has announced they are entering the gift card space. With this newest development, Square has now made it available for its merchant clients to provide virtual gift cards to customers. Customers can email these gift cards to friends and family as gifts. When a friend receives a gift card as a present, she can simply store the card in her Square Wallet app or, if she has Apple’s latest OS, she can store it in Apple’s Passbook wallet.

Users can then redeem these gift cards at participating stores by simply scanning the barcode directly from their phones. The Square Wallet is even more advanced, as it will actually open a tab on a mobile device when a user walks into a participating store.

Danielle Thomas is a writer for Processingfinder.com, where you can find strategic visions and informational articles on the payment industry. If you would like to read more on where the payment industry is headed, click here.