SAN FRANCISCO — Even as Twitter prepares for a hotly anticipated initial public offering, its co-founder Jack Dorsey already is about to debut a second act.
His start-up Square, one of the fastest-growing young companies by revenue and one of the most buzzed about in high-tech, has taken what is widely seen as a step toward its own IPO.
On Wednesday, the mobile payment service announced that former Goldman Sachs Chief Financial Officer David Viniar would join its board.
The addition of Viniar lends Square instant credibility on Wall Street. At the time he retired from Goldman Sachs last January, Viniar was one of the highest-profile and best-compensated executives in the financial industry.
Goldman Sachs is also the lead bank for the Twitter IPO. Square CFO Sarah Friar, a former finance executive at Salesforce.com who also spent 10 years at Goldman Sachs, introduced Viniar to Square, a Square spokesman said.
"The growing scope of Square's business and long-term vision is inspiring," Viniar, who met with the board Wednesday, said in an emailed statement. "I'm honored to join Square's Board at such an important time in the company's growth."
Asked in September when Square would go public, Dorsey told Bloomberg TV: "Eventually we'll get there. Right now we're building the practice within the company and building the discipline. I think Square is ahead of a lot of companies in that regard because I think we're building a financial company."
Viniar replaces Starbucks Chairman, President and Chief Executive Howard Schultz, who joined the board in August 2012. A Starbucks spokesman said Schultz's intent was to serve on the Square board for about one year.
"Jack has assembled a strong and forward-thinking leadership team at Square," Schultz said in an emailed statement. "I am proud of what our companies have accomplished together this past year and I'm excited about the opportunities for Starbucks and Square to continue to innovate together."
Rick Oglesby, a senior analyst with market research firm Aite Group, said having Schultz on the board was crucial to Square's prospects.
"He's Square's largest customer at this point and having your largest customer on the board is very important," Oglesby said.
As Square begins to reach out to consumers, Starbucks is serving as a key strategic partner, he said.
Starbucks invested $25 million in Square as part of a round of financing in August 2012 that valued Square at $3.25 billion. In addition, Square struck a deal with Starbucks to process all credit and debit card transactions at Starbucks stores in the U.S. and to accept payments from Square's mobile Wallet app.
Square Wallet, which the company rolled out in 2011 to make it easier for consumers to buy things with their smartphones, has not yet been aggressively marketed to consumers.
"Schultz is a key decision maker on when that's going to happen," Oglesby said.
Dorsey hatched Square in his San Francisco loft apartment in 2010 after stepping down as chief executive of Twitter.
He teamed with Square's co-founder, Jim McKelvey, a glassblower who had designed a $2,500 bathroom faucet but didn't make a sale because he couldn't process a credit card, in 2009.
Their idea: to make it possible for anyone to accept plastic, even small merchants for whom credit cards were too expensive or complicated. They created a credit card reader that attaches to a smartphone and swipes cards for a 2.75% transaction fee, most of which Square turns over to credit card companies.
Square also offers merchants the option of paying $275 a month for an unlimited number of transactions, up to $250,000 a year.
Square says it is processing credit-card transactions at a rate of $15 billion a year — not including the Starbucks deal.
Square has caught on with small merchants, but it's trying to cast a broader net. Square recently launched Square Cash in the U.S., which lets people send money via email.
It has hefty competition from technology giants, financial institutions, telecommunications companies and national retailers.
"The way I look at Square is that they have an ultimate goal of creating an Amazon-like company that works outside the confines of e-commerce and in the world of physical retail," Oglesby said. "Physical retail is 20 times the size of e-commerce, so there is huge market potential there."
Viniar joined Goldman Sachs in 1980 after graduating from Harvard Business School. He became CFO in 1999, the year Goldman went public, and also oversaw operations, technology and finance.
He played a key role in helping the company through the global financial crisis and through the settlement of charges by securities regulators that it misled investors in its sale of mortgage securities. In 2010, Viniar had to testify before Congress about the firm's conduct.