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If you're someone who likes to read management or business case studies, Square serves as a terrific example of how not to operate in several key areas:

• how not to manage projects
• how not to manage people and retain great employees
• how not to remain relevant in an increasingly competitive payments landscape.

The sole area of excellence is the San Francisco office's cafeteria, which is on par with a fine restaurant.

Introduction

Square started with a fantastic product: the iconic Square Reader, which may still be the best designed, most reliable credit card reader device for mobile devices. Unfortunately, like many companies that start small and focused, they lack the managerial focus to become a standout performer.

As my title suggests, the story of Square boils down to this: it's a case study in misdirected talent.

And talent there is: Square boasts some great industry minds (as some of the more benevolent reviews suggest.) However, it is my view and my personal experience that winning product strategies, focused execution, and experienced management can succeed with merely "good" talent, while no amount of talent can rescue a company devoid of the other elements. Do they really fall down in those areas? Let's examine each notion in turn:

• Product Strategies: an Uphill Battle *

Virtually all of Square's low-or-no-margin payment businesses (mobile Reader, Square Register, Cash, etc.) face enormous competition from both entrenched competitors and more focused upstarts. Although it is the opinion of the author that the Reader product is the best in the business, the ugly truth may be (much to the dismay of their meticulous designers) that margins matter more to customers than design, and in this area, they will be driven to the dirt by Amazon and others.

• Inefficient Execution *

It's hard to quantify execution capability. From the perspective of the author, however, I would say that I have seen much more accomplished, by fewer (less talented) people, in less time. The reason this is true is that the rank-and-file engineer at Square has little industry experience, and many managers have no prior experience managing people. (This is discussed below.)

• Poor Management *

Past Glassdoor reviews (some of which seem to have disappeared) mentioned chaotic, Twitter-like management, replete with disorienting reorganizations. This is still the case. While there is significant talent at the senior level, the middle management is rife with inexperienced young people who have never managed others at all, many of whom were promoted due to their perceived engineering ability.

This has led to several situations that would be hilarious if they weren't so sad: Lack of clear ownership of major functionality, huge variability of code quality across teams, borderline-hostile code reviews, poor training, humiliating and unprofessional behavior in meetings, bad technology choices, and so on.

Conclusion

Despite the hype, talent, and early success of the Reader product, and despite the purported sky-high valuation (which makes no sense when compared to industry comps), Square is no longer a horse worth betting on. With a product portfolio consisting of low or no margin businesses, its apparent lack of focus and efficiency, and terrible management all add up to a company whose drawbacks far exceed potential benefits.

Recent college graduates should realize that the company is no longer a start-up; you're joining a medium sized firm that's still struggling to find its way in a sea of competitors. If you're talented enough, you'd be better off trying for Google or another quality big firm to shore up your skills, and THEN move to a start-up.

The situation is even worse for experienced hires: compensation won't match what a skilled engineer can earn elsewhere, with far less hassle, and more prospects for growth. You're also likely to face a bait-and-switch when it comes to your position and duties, as well as the aforementioned issues with bad management.

At the end of the day, while probably not a sinking ship, Square is idling at port, bobbling listlessly while the smartest rats scurry down the mooring lines for the relative safety of the rotting boards of the dock.

Find a high-margin strategy that offers true product differentiation and stick to it.

Look hard at middle managers; they are your weakness.