Square gets $100M, valued at $1B

One thing is clear: Investors are in love with Square, the payments company co-founded by Jack Dorsey, the co-creator of Twitter. The company today announced that it has received yet another big slug of funding. The veteran venture capital firm of Kleiner Perkins Caufield & Byers is leading the $100 million investment in the company. The company is said to be valued at $1 billion. Techcrunch first reported the likelihood of this round of financing and hyper valuation about two weeks ahead of the Wall Street Journal (s nws).

Square CEO & Co-Founder Jack Dorsey

In comparison, Square was valued at $240 million in January 2011 when it did its last round of financing and raised $27.5 million. Square so far has attracted about $30 million in funding. Visa (s v), the credit card giant, made an undisclosed strategic investment in the company recently.

Former star wall street analyst Mary Meeker is going to join the board of Square, which also includes Vinod Khosla of Khosla Ventures and Larry Summers, economic advisor to President Obama. The high-powered board, a charismatic founder, a seasoned operator (Keith Rabois) and a fast growing product offering has made Square one of the hottest new companies in Silicon Valley. It doesn’t surprise me; Square always felt like a game changer to me, though it’s hardly a slam-dunk even now.

The new payment ecosystem is changing pretty rapidly and has become a playground for corporate giants that include everyone from eBay (s ebay) to Verifone (s pay) to Google (s goog) to Apple (s aapl) and telecom carriers. Square, for now, has the groundswell to keep growing amongst small and independent business that have been unable to take credit cards.

According to the Wall Street Journal, Square is processing nearly $4 million in payments each day. It will process a billion dollars in payments with a year, Rabois told the newspaper. Rabois, formerly of PayPal and Slide, believes that Square is going to be worth more than PayPal.

Square, based in San Francisco, is the latest among the fast-growing Internet startups to attract massive slugs of money from investors. Foursquare, Twitter, DropBox and Air BnB are some of the startups that have taken investments in order to create momentum for their business.