In the age of the super app, everything is linked. Which means that some enterprises which might seem to make strange bedfellows make for a power couple when they marry (read: mergers and deals and investments).
That synthesis can offer up a continuum of services through a broad range of use cases. The platform’s the thing, then, for an ever-expanding roster of services that can be layered, and expanded, depending on the audience. To that end, and as reported on Thursday (March 4), Square said it has agreed to buy a majority stake — for cash and stock — in Tidal for $297 million.
Tidal is billed as “an artist-led music and entertainment platform” and will operate independently within Square. Also, Jay-Z, the rap and music mega force, will join Square’s board of directors upon the deal’s closing.
So: a payments-focused tech firm (software and hardware, and it should be noted, firmly entrenched in apps and bitcoin trading) buys a platform firm focused on content. It’s the second announcement this week that signals a wide net being cast by Square beyond what was once the bedrock of the business — namely, card readers in brick-and-mortar merchant locations.
As reported earlier this week, Square’s Utah-chartered industrial bank launched. And as we reported upon that launch, Square now is primed to offer financial services such as deposits. The initial forays will focus on servicing the company’s network of small businesses that are already operating on Square’s payment processing platform.
Here’s a tell as to what might be in the cards for the Square/Tidal effort. The New York Times reported on Thursday that, per Jesse Dorogusker, a Square executive tapped to lead Tidal (reportedly on an interim basis), Square will offer Tidal artists financial tools that in turn can help them manage financial life. “There are other tools they need to be successful and that we’re going to build for them,” he told the Times.
And that statement may conjure up (since the details are sketchy so far) an artist who uses banking services provided by the industrial bank, depositing royalties or ticket fees into accounts. The payments? Maybe they’re made by Cash App, directly between users. Maybe they’re done, eventually, by means of bitcoin.
Much is possible, and that’s the point of the platform model, and particularly the super app. As the name implies, that app hosts a range of offerings, with one proverbial “front door” that brings consumers to a variety of services that interconnect and inform one another as the user moves from, say, banking to transacting to planning for retirement.
The Square/Tidal deal may hint at a sea change for musicians and artists (where not all that long ago they’d been at the mercy of record companies). Now, content and services meant to monetize that content (and shepherd that money into proactive financial management) may find seamless comingling on an online platform. There’s no reason to expect the model cannot be replicated across any number of “verticals” and end users.
Oh — and Scoring Jay-Z as a board member? With a nod to Huey Lewis and the News: It’s hip to be Square.
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