Is Jack Dorsey Playing Jay-Z, or Is Jay-Z Playing Jack Dorsey?
Here’s what the surprise Square acquisition of Tidal is really about
In a deal that basically no one was anticipating, payment service Square announced yesterday that it will acquire a majority stake in Tidal, the music-streaming platform co-owned by Jay-Z, for $297 million in cash and stock. Square CEO Jack Dorsey revealed the acquisition on Twitter — the other company he runs — where he preemptively raised the obvious reaction: “Why would a music streaming company and a financial services company join forces?!”
The thread that followed offered mostly vague PR-speak answers to that question: “New ideas are found at the intersections, and we believe there’s a compelling one between music and the economy.” While that’s probably to be expected at the announcement stage of a distinctly unexpected partnership, the immediate market reaction was tepid, with Square shares dipping about 6.75% on Thursday. But there are a few reasons — perhaps not so lofty as those Dorsey suggested — that this deal isn’t as utterly random as it sounds.
For starters, the motivation for buying Tidal could be as simple as Square making a high-level acqui-hire: Jay-Z, whose rep for street cred and entrepreneurial acumen continues to top itself — luxury giant LVMH just…
