On Tuesday, fast growing mobile payments startup Square introduced Stand, a hardware device that cradles an iPad, turning it into a countertop point of sale system. Square CEO Jack Dorsey and Jesse Dorogusker, a former Apple (AAPL) exec who led the development of Stand, spoke with Fortune on Monday about what Stand means for the company. What follows is an edited transcript of the conversation.
Fortune: You're introducing Stand to appeal to a different kind of merchant, right?
Dorsey: It opens the door for brick-and-mortar, high-volume (businesses). It takes another excuse off the table (for not choosing) Square.
How does Stand compare with more traditional point of sale systems?
Dorsey: It's a complicated question because there are many different answers to that. If you go to the very, very bottom of the line, a cash register, you can buy one from Sharp, Panasonic for $300 dollars to $600 dollars. These are unfortunately calculators on top of cash boxes. When you start getting analytics, when you start getting into some of the features that we have built into the software, integrated cards swipes, you are talking more than $5,000 and close to $10,000 dollars. That usually includes a two-year lease or a two-year agreement for service.
Dorogusker: And when you think about the aesthetics of those products, it is a new universe we are creating here. To be able to match our merchants' pride in their own work with something that is appropriate for their countertop, something they can be proud of, compared with everything else Jack has described, is really powerful.
What's your business objective. Is Stand meant to be a profit center, or is it a tool to get more merchants into the Square payment ecosystem?
Dorsey: We are optimizing for growth. We are optimizing to appeal to more merchants, as we did with the card reader. We see this is as another door we opened to another class of merchants.
Square started catering to very small merchants, and the company's identity was built around that. What does this product say about the kind of company Square is now?
Dorsey: It says that Square grows with our customers. When we started the company it was always about building a general utility that could scale from the smallest individual to the largest entity in the world. This is definitely moving up. But there is a nice path. I can start my business, making cupcakes and start with the reader and an iPod touch. Then I can get a cart, or I can get retail space in a mall and have a solution there as well. I can add as much as I need. If I need a receipt printer, I can add that; if I need a cash register, I can add that.