Update, 10:10 a.m.:
Now it’s official: Square announced this morning that it has indeed acquired Caviar. Terms of the deal were not disclosed, and Caviar CEO Jason Wang notes in a blog post that his company will continue to operate independently for now.
“Today, we’re excited to announce that Caviar is joining Square,” Wang wrote. “Together we’ll double down our mission of delivering premium food through a premium delivery service with no compromises — giving buyers easy access to the food and restaurants they love so much.”
Square, which recently debuted Square Order, said today that the acquisition of Caviar “deepens its commitment to providing independent sellers with services that make it easier for them to grow their business.”
“Caviar’s curated, seamless delivery experience is exactly the kind of service we want to provide buyers and sellers,” CEO Jack Dorsey said in a statement. “By making delivery such a fast, friendly, and easy process, Caviar gives time back to restaurants so they can focus on what they do best — cooking great food for their customers.”
With its new acquisition, Square enters a highly-competitive food delivery space.
“It’s a rush right now,” Wang told GeekWire last month. “It almost feels like a bit of a land grab. I think eventually, there wil only be a few players that will win the market.”
Square not only wants to help you purchase items, but now the payments company would like to deliver your next meal, too.
Re/code reported this morning that the mobile payments company will announce the acquisition of Bay-Area-based food delivery startup Caviar this week. This confirms earlier reports from TechCrunch and The New York Times, which noted that Square will pay around $90 million in an all-stock deal to acquire Caviar.
Caviar, which has raised $15 million and was founded just two years ago, partners with local restaurants and uses contractors to bring food from eateries to people’s homes and offices around town.
“We are very valuable to the restaurants we work with,” Caviar CEO Jason Wang told us last month. “There is no extra overhead or fixed costs for them, and they can make additional revenue at a very low cost, with a very low risk. As a restaurant owner, it’s pretty much a no brainer to sign up.”
The startup is in seven markets and has a long list of competitors, including new companies like Munchery and Bitesquad, in addition to incumbents like Eat24 and GrubHub. Along with your typical pizza and Chinese delivery services, the food delivery arena is crowded.
Perhaps Square thinks that Caviar is one of the “few players that will win the market,” as Wang described. We actually gave the service a try week in our epic food delivery startup review last month, and found Caviar to be one of the better options. It had an easy online ordering system and the customer service was excellent, but the $9.99 delivery fee was a little annoying. Coincidentally, Caviar this morning announced that it is slashing delivery fees from $9.99 per order to $4.99 for the month of August.