Square to Investors: $1 Billion Valuation? That's So Last Week. Make It $2 Billion.

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Square is still working on raising its $50 million-or-so next round of venture capital, and we’ve heard from several sources why it’s taking so long. It seems Square is no longer content to be in the $1 billion valuation club, which is admittedly getting a little crowded. I mean, once they’ve let Spotify in, they’ll let any hot app in, right?

Square is now angling for a whopping $2 billion valuation. That’s caused some well-heeled investors to balk, while others are still listening.

Momentum aside, Square is trying to do something that’s incredibly hard and expensive. Everyone agrees that payments need to be disrupted again (except maybe eBay and the credit card companies), and given the general antipathy towards to financial sector, the time is right. And Square seems to have the best shot of anyone out there.

In addition to a sexy device and UI, Square CEO/Twitter founder Jack Dorsey has a major edge in promoting a brand, because he’s reached that rarified level of status where he could be interviewed by Charlie Rose, Oprah or Howard Stern on any given week. That’s important because Square needs mass market promotion, and that can get expensive if you have to pay for it.

But Square is still a long way from pulling off the necessary network effects for the business model to work. And Dorsey also represents one thing that worries potential investors: A CEO who is splitting his time between two companies, in Dorsey’s case Twitter and Square.