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CNBC Exclusive: CNBC Transcript: CNBC’s Kayla Tausche Speaks with Jack Dorsey, Square and Twitter Co-Founder and CEO, on CNBC’s “Closing Bell” Today

WHEN: Today, Wednesday, March 9th

WHERE: CNBC's "Closing Bell"

Following is the unofficial transcript of a CNBC EXCLUSIVE interview with Jack Dorsey, Square and Twitter Co-Founder and CEO, and CNBC's Kayla Tausche on "Closing Bell" (M-F, 3PM-5PM ET) today, Wednesday, March 9th.

All references must be sourced to CNBC.

SARA EISEN: CNBC'S KAYLA TAUSCHE IS AT SQUARE'S HEADQUARTERS, WHERE SHE'S JOINED IN A CNBC EXCLUSIVE BY COFOUNDER AND CEO JACK DORSEY. KAYLA, TAKE IT AWAY.

KAYLA TAUSCHE: SARA, THANK YOU SO MUCH. THANKS TO JACK FOR HAVING US HERE AT SQUARE.

JACK DORSEY: THANKS FOR COMING.

TAUSCHE: THE QUARTER SAW A BIG BLOWOUT NUMBER ON REVENUE, ALSO PERHAPS A SURPRISE THAT YOU EXPECT TO BE PROFITABLE WITHIN THE YEAR. WHAT'S WORKING HERE?

DORSEY: A LOT. FIRST OUR PHONE CUSS ON ONLINE PAYMENTS AND MAKING SURE WE'RE DISTRIBUTING OUR HAIRED WARE IN AN EASY WAY. WE PUT A BIG FOCUS ON THE EMV SHIFT TO CHIP CARDS. WE ANNOUNCED WITH APPLE OVER THE SUMMER OR NEW CONTACT LIST AND CHIP CARD READER. WE HAVE SHIPPED 350,000 PRE-ORDERS AND THEY'RE AVAILABLE ON EVERY APPLE STORE AS WELL. WE THINK THIS IS A BIG CHANGE IN THE INDUSTRY, AND OUR MAIN FOCUS IS AROUND MAKING SURE THAT OUR SELLERS CAN ACCEPT ANY FORM OF MAIM, AND WE'RE SEEING THAT SHIFT VERY, VERY QUICKLY, AND WE'RE TAKING FULL ADVANTAGE OF IT BY PUTTING OUR SELLERS FIRST.

TAUSCHE: HOW LONG CAN YOU RIDE THE TAILWIND OF THAT TRANSITION? BECAUSE IT WAS SET IN MOTION ABOUT SIX MONTHS AGO, WITH THEDEADLINE IN OCTOBER, AND THEN AT THE SAME TIME, WHILE YOU HAVE HARDWARE REVENUES MORE THAN DOUBLING, YOU HAVE SOFTWARE AND DATA REVENUE THAT IS UP BY A FUNCTION OF NEARLY FIVE. SO IS THIS REALLY A STORY ABOUT HARDWARE? IS IT A STORY ABOUT SOFTWARE?

DORSEY: EVERYTHING WE DO STARTS WITH THE HARDWARE. AND WE START WITH THAT LOGO ON THE COUNTER OR SOME SOMEONE'S HANDS. THEY CAN ACCEPT A CHIP CARD, A FOLKS, AND THAT OPENS THE DOORS TO OUR ENTIRE ECOSYSTEM. WE START WITH THE MOST CRITICAL THING, WHICH IS HOW DOES A SELLER MAKE A SALE, AND HOW DO WE GIVE THEM TECHNOLOGY THAT WE BELIEVE WILL EXIST OVER A DECADE. THIS IS NOT A ONE-TIME SHIFT WE'RE RIDING THE TAILWINDS OF. THIS IS HOW THE INDUSTRY WILL PLAY OFF-LINE GOING FORWARD. WHILE WE LOVE MORE AUTHENTICATED PAYMENTS, WE LOVE APPLEPAY, ANDROID PAY, AND INTO IT'S SELLERS CAN SEE MORE CUSTOMERS, BUT THE CUSTOMERS CAN HAVE A MUCH FASTER AND BETTER EXPERIENCE AS WELL. ANYTIME YOU SEE A SQUARE LOGO, YOU KNOW YOU CAN PAY WITH YOUR PHONE, YOUR WATCH, THE FASTERS WAY AND GET ON WITH YOUR DAY.

TAUSCHE: WHAT ABOUT SQUARE CAPITAL? HOW MANY MERCHANTS ARE SAYING THEY WANT A CASH ADVANCE?

DORSEY: THIS ONE HAS BEEN FANTASTIC AREN'T BY FOCUSING ON PAYMENTS WE OPEN THE APERTURE FOR MORE FINANCIAL SERVICES. SQUARE CAPITAL WORKS IN A PRETTY SIMPLE WAY. WE SEND AN E-MAIL TO A CUSTOMER. THEY CAN TAP ON A BUTTON, AND THAT MONEY GOES INTO THEIR CASH INSTANTLY. THEY CAN USE THAT CAPITAL TO BUILD THEIR BUSINESS. THE WAY THEY PAY IT BACK IS EVERY TIME THE CUSTOMERS PAY, WE TAKE A SMALL TRANSACTION FEE, AND IT'S PAID BACK BEFORE THEY KNOW IT. OUR TYPICAL CUSTOMER ASKS FOR ANOTHER ONE, AND THIS IS A PRODUCT THAT WE REALLY LOVE. IT BUILDS OFF THE POWER OF A STRONG PAYMENTS NETWORK, BUT ALSO OFFERS A REAL NEED TO A SMALLER SELLER AND A MICROSELLER THAT THEY JUST CAN'T GET FROM A TYPICAL BANK.

TAUSCHE: WHAT HAPPENS WHEN THE ECONOMY GETS SOFT, YOU HAVE LOANS ON THE BALANCE SHEET THAT YOU'RE TRYING TO KEEP CLEAN? HOW DO YOU MAINTAIN CREDIT QUALITY AS THE ECONOMIC BECOMING MORE VOLUME TIFF?

DORSEY: THIS IS AROUND GOOD TECHNOLOGY. WE HAVE A DEEP UNDERSTANDING OF OUR SELLERS, WHERE THEY'RE GOING, THEIR BUSINESSES, WHAT RISKS THEY FACE, WHAT THEY NEED SPECIFICALLY? SO WE CAN BE VERY DIRECT ABOUT GIVING THEM THE CAPITAL THEY NEED AND WHAT THE RISK IS, AND WE MAKE A CALCULATED DECISION EVERY CASE. SO I FEEL GOOD ABOUT THAT, BECAUSE IT'S SOMETHING THAT WE'VE BEEN DOING FOR SEVEN YEARS.

TAUSCHE: THERE ARE A LOT OF COMPANIES, THOUGH, THAT ARE TRYING TO DO THAT. AND EXCUSE ME FOR INTERRUPTING, BUT I'M JUST CURIOUS WHY A JPMORGAN CHASE, WHICH HAS A TON OF DATA AT ITS FINGERTIPS AS WELL, WHY A VISA, COMPANIES WHO ARE ALSO PARTNERS AND INVESTORS THAT HAVE A LOT OF RESOURCES TO SPEND ON THEIR OWN COULDN'T CREATE THE SAME THING?

DORSEY: WELL, YOU KNOW, OUR POSITION HAS ALWAYS BEEN THE BANKS AND THE FINANCIAL SYSTEM TODAY WORKS PRETTY WELL, BUT IT'S NOT ACCESSIBLE TO EVERYONE. IT'S NOT INCLUSIVE TO EVERYONE, AND WHAT WE CAN DO IS REALLY OPEN THE APERTURE FOR MORE PEOPLE TO GET INTO IT. TYPICALLY BANKS AREN'T LENDING AT THE LEVELS WE ARE LENDING AT. THEY'RE NOT ADVANCING CAPITAL TO PEOPLE IN A WAY THAT THEY CAN ACTUALLY GET A PROFIT FROM. SO WE CAN, AND IT'S BECAUSE OF THAT UNDERSTANDING THAT WE HAVE OF OUR EL SELLERS AND BRINGS MORE PEOPLE ONTO THE RAILS, IN THE RIGHT WAY, AND BRINGS THEM ON IN A FAIRWAY.

TAUSCHE: DO YOU FEEL PRESSURE FROM COMPANIES LIKE CHASE, WHICH IS TAKING OVER YOUR PREVIOUS PARTNERSHIP WITH STARBUCKS. IT'S GOING TO LAUNCH AN INSTANT SETTLING LATER THIS YEAR? IT'S ONE OF YOUR LARGEST SHAREHOLDERS, BUT I'M CURIOUS, NOW THIS SPACE IS GETTING SO COMPETITIVE, HOW THAT RELATIONSHIP CHANGES?

DORSEY: THE RELATIONSHIP DOESN'T CHANGE. CHASE IS A HUGE PARTNER TO US, AS MANY OTHER FINANCIAL INSTITUTIONS ARE, AND OUR FOCUS IS ON OUR STRENGTHS. OUR STRENGTHS ARE SIMPLICITY, ON SPEED AND COHESION OF THE TOOLS THAT WE PROVIDE TO OUR SELLERS SO THAT THEY CAN PROVIDE A GREAT EXPERIENCE FOR THEIR BUYERS. IF WE CAN DO THAT, THEIR BUSINESS GROWS, AND IF THEIR BUSINESS GROWS, OUR BUSINESS GROWS. WE HAVE A VERY NICE VIRTUOUS LOOP IN OUR BUSINESS.

TAUSCHE: OBVIOUSLY YOU GUYS ARE INVESTING IN THE BUSINESS, BUT YOU WILL BE PROFITABLE THIS YEAR. THAT'S WHAT WE LEARNED TODAY. WHERE IS IT THAT YOU'RE GOING TO BE CONTROLLING COSTS TO GET THERE?

DORSEY: WE'RE ACTUALLY – WE HAVE A VERY HEALTHY PAYMENTS BUSINESS, AND WE HAVE A VERY HEALTHY AND GROWING SOFTWARE AND DATA BUSINESS AS WELL. SO IT'S NOT A MATTER OF MANAGING COSTS, IT'S REALLY MAKING DECISIONS AROUND INVESTMENT. WE PUT OUR PEOPLE FIRST, OUR EMPLOYEES, AND WHAT THEY'RE BUILDING, AND WE WILL CONTINUE TO HIRE GREAT PEOPLE TO BUILD SERVICES THAT THE PEOPLE VALUE AND PEOPLE LOVE. AND AS WE SEE THAT VALUE, THAT INCREASES. SO SQUARE HAS BEEN A VERY STRONG AND REALLY PREDICTABLE BUSINESS FOR US, AND WE'RE REALLY HAPPY WITH THAT BECAUSE WE FEEL LIKE WE HAVE A REAL UNDERSTANDING OF HOW THE BUSINESS GROWS AND WHAT IT TAKES TO MOVE IT FORWARD AND CAN REALLY UNDERSTAND WHAT TO DO NEXT.

TAUSCHE: GOING INTO TODAY, THERE WAS A LARGE PERCENTAGE OF THE AMOUNT OF STOCK OUTSTANDING IN SQUARE THAT WAS BEING BORROWED TO SHORT THE COMPANY. WHY DO YOU THINK PEOPLE ARE BETTING AGAINST YOU OR BETTING AGAINST SQUARE?

DORSEY: I DON'T KNOW IF IT'S NECESSARILY US. I THINK THERE'S A LOT HAPPENING IN THE MARKET THAT IS COMPLICATED. I THINK WE NEED TO CONSTANTLY SHOW THAT WE'RE FOCUSED ON THE RIGHT THINGS. WE ARE FOCUSED ON BUILDING GREAT TOOLS FOR SELLERS AND THAT THEY VALUE THEM. AND WE CONTINUE TO SEE THAT GROWTH, AND I THINK WE'RE NOT ONLY A FIRST MOVER IN A LOT OF AREAS, AND INNOVATOR IN A LOT OF AREAS, BUT ALSO WE HAVE THE BEST EXPERIENCE. AND WE CERTAINLY COMPETE WITH A LOT, BUT WHAT WE FIND IS THAT OUR COMPETITORS ARE ONLY GOING AFTER ONE PART OF THE EQUATION, WHEREAS WE'RE LOOKING AT A COHESIVE END TO END OF WHAT A SELLER TRULY NEEDS, AND THAT IS REALLY UNIQUE. SO I THINK THERE'S STILL A MISUNDERSTANDING OF EVERYTHING THAT WE DO, AND WHY. AND AS WE CONTINUE TO BE ABLE TO TELL OUR STORY, THIS IS OUR FIRST EARNINGS CALL AND OUR FIRST SHAREHOLDERS LETTER, THE FIRST TIME WE REALLY GET TO GET OUT THERE AND TALK ABOUT HOW GREAT OUR BUSINESS IS AND WHY WE'RE EXCITED ABOUT IT, AND HOW SELLERS SEE IT. WE'LL BUILD THAT CONFIDENCE. I'M NOT WORRIED ABOUT THAT.

TAUSCHE: OF COURSE, TODAY THERE'S CONFIDENCE IF WE HAD THIS CONVERSATION A MONTH AGO, YOUR STOCK WOULD HAVE BEEN BELOW THE IPO PRICE, AND A LOT OF THAT IS OUTSIDE OF ANYONE'S CONTROL. I'M CURIOUS WHAT IT'S LIKE TO BE THE CAPTAIN OF THIS SHIP, OF TWO SEPARATE SHIPS DURING A TIME OF SUCH VOLATILITY?

DORSEY: I'M REALLY PROUD OF THE COMPANY FOR THE TRANSITION IT MADE FROM PRIVATE TO PUBLIC. YOU KNOW, WE HAD A LOT OF CONVERSATIONS AS A COMPANY OF WHAT THIS MEANS FOR US AND WHAT WE SHOULD FOCUS ON. AND THERE'S GOING TO BE A LOT OF NOISE, WE'RE ENTERING INTO A MARKET THAT IS TURBULENT, THAT IS A LITTLE BIT CONFUSING, AND, YOU KNOW, CERTAINLY HAS AS MANY NEGATIVES AS IT DOES POSITIVE. BUT WE'RE DOING IT EYES WIDE OPEN, AND WE'RE DOING IT WITH AN UNDERSTANDING OF WHAT MATTERS. AND WHAT MATTERS IS WE'RE BUILDING A TOOL, AND DO PEOPLE WANT TO USE IT? AND IF THEY WANT TO USE IT, THE VALUE OF OUR COMPANY INCREASES, AND WE'RE TAKING A LONG-TERM VIEW OF THAT. BUT THE ONLY THING THAT WE CAN CONTROL IS WHAT WE SHIP. AND IF PEOPLE LOVE THAT. AND IF WE'RE LEARNING FAST ON THAT, THEN THEY'LL CONTINUE TO USE IT AND CONTINUE TO PAY US. THAT IS REALLY WHAT WE HAVE TO OPTIMIZE FOR.

TAUSCHE: ARE YOU WORRIED THAT IF A PRODUCT STUMBLES, IF YOU HIT A ROADBLOCK, THAT PEOPLE WILL PUT THE BLAME ON YOU AND SAY HE'S SPREAD TOO THIN?

DORSEY: YOU KNOW, I'M CONCERNED ABOUT A NUMBER OF THINGS, BUT MY MAIN CONCERN IS REALLY ARE WE DELIVERING SOMETHING FOR PEOPLE THAT THEY VALUE AND THEY WANT TO USE MORE AND MORE AND MORE OF. AND THAT IS MY STRONGEST SIGNAL AND MY STRONGEST BAROMETER. AND THAT'S WHAT WE'RE GOING TO FOCUS ON.

TAUSCHE: ALL TECH COMPANIES HAVE HAD ANOTHER ITEM ADDED TO THEIR TO-DO LIST WITH THIS RECENT SITUATION BETWEEN APPLE AND THE FBI. SQUARE AND TWITTER HAVE BOTH FILED AMICUS BRIEFS IN SUPPORT OF APPLE'S POSITION. BUT YOU HAVE BEEN INDIVIDUALLY REFERENCED BY TERRORIST GROUPS AT CERTAIN TIMES BECAUSE OF YOUR JOB, BECAUSE OF HOW HIGH PROFILE YOU ARE. I'M WONDERING HOW JACK DORSEY THE PERSON COMES AT THIS ARGUMENT.

DORSEY: WELL, THANK YOU FOR ASKING THAT. THANK YOU FOR BEING CONCERNED. I GUESS WE'RE BUILDING A TECHNOLOGY THAT STANDS FOR SOMETHING. WE'RE BUILDING A TECHNOLOGY THAT HAS SIGNIFICANT PURPOSE IN THE WORLD. AND, YOU KNOW, A BIG PART OF WHAT WE HAVE TO DO IS MAKE SURE THAT PEOPLE FEEL SAFE USING IT. AND THAT'S, YOU KNOW, EVERYONE WHO USES OUR TECHNOLOGIES, BUT ALSO ME PERSONALLY, AND I'M JUST HONORED THAT WE ARE PART OF SOMETHING THAT REALLY CAN INFLUENCE AND CAN REALLY, YOU KNOW, SHOW PEOPLE A DIFFERENT WAY OF THINKING AND CHANGES THE WORLD AND HOW PEOPLE USE IT TO CHANGE THE WORLD. SO THAT IS WHAT I CONSIDER. I TAKE A LONG-TERM VIEW. THERE'S ALWAYS GOING TO BE NEGATIVITY. BUT AS LONG AS WE'RE MAKING PEOPLE FEEL SAFE AND THAT THEY CAN USE THIS TOOL AND THEY TRUST IT, WE'RE DOING THE RIGHT THINGS.

TAUSCHE: WELL JACK, I KNOW YOU HAVE AN EARNINGS CALL THAT BEGINS MOMENTARILY SO WE WILL LET YOU GO. BUT WE APPRECIATE YOUR TIME TODAY.

DORSEY: THANK YOU.

TAUSCHE: AND MAKING YOURSELF AVAILABLE. JACK DORSEY IS THE CO-FOUNDER AND CEO OF SQUARE. GUYS, BACK TO YOU.

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