Square is expanding its role as the money transaction middleman with the acquisition of a food delivery service.
After a few rumors here and there over the last few days, the San Francisco-based company confirmed that it intends to acquire Caviar.
Founded in 2012 not too far away from Square HQ, Caviar maintains a mobile app for food delivery from higher-end restaurants across the San Francisco Bay Area, New York, Chicago, Washington DC, Boston, and Seattle.
A big draw for Caviar was that it provided delivery from restaurants that are typically popular and do not otherwise offer delivery on their own.
While announcing the merger on Monday, Square emphasized that Caviar's approach is a more affordable alternative to in-house delivery schemes that drives additional revenue.
Caviar alone has already grown in volume 500 percent on an annual basis, with 80 percent of its monthly deliveries going to repeat — meaning, loyal — customers.
Those numbers should give Square a firmer footing in not just providing the basic financial transaction infrastructure but also serving as the complete link between sellers and their customers.
"Caviar’s curated, seamless delivery experience is exactly the kind of service we want to provide buyers and sellers," said Square CEO Jack Dorsey in a statement, explaining how this will make it easier for Square subscribers to grow their businesses.
More than 50,000 restaurants already use the Square Register point-of-sale platform.
It is possible that Caviar will eventually be folded into Square Order, another recently released product from the payments processing company for pre-ordering food and drinks for pickup.
Still, the Caviar team followed up in a separate blog post, noting that Caviar will operate separately from Square for the time being.
Nevertheless, Caviar CEO and co-founder Jason Wang also pointed toward Square's reach nationwide, which will help propel and scale the delivery brand to many more restaurants.
Financial terms of the deal have not been disclosed.