Square Jack Dorsey
Square set its IPO price at $9 Wednesday night. Pictured: CEO Jack Dorsey, who is also the co-founder of Twitter. Kimberly White/Getty Images for Vanity Fair

Update: 6:30 p.m. EST

Square closed $4.07 or 45 percent up, ending the day at $13.07. The close brought the payment company's shares to the higher bound of the original price range set for its IPO. After an early surge to above $14 a share, Square stock subsided and traded around $13 for most of the day.

Original Story:

Within minutes of its Wall Street debut, shares of Square (SQ) were trading above $13 per share, a 40 percent pop over its initial offering price of $9.

The payments company launched by Twitter co-founder Jack Dorsey hit some potholes in its approach to an initial public offering this week. The company priced at an underwhelming $9 per share late Wednesday, missing an anticipated price range for a valuation of $2.9 billion -- far short of the $6 billion valuation that private investors sought in previous funding rounds.

The less-than-stellar launch comes as public investors have grown skeptical of the sticker price on Silicon Valley's 140-plus unicorns, or private companies valued at over $1 billion, even as private investors continue pouring millions of dollars into promising tech ventures.

Increasingly, those investors are inking deals that ensure profits even if the company whiffs its IPO. Such provisions, called "ratchets," meant Square had to pay out some $93 million in extra shares to late-stage investors, including JPMorgan Chase & Co., that had expected Square to open at more than double the price that it did.

According to S&P Capital Insights, the average tech IPO in the second half of 2015 experienced a one-day pop of more than 13 percent.

Coincidentally, another company went public valued at $2.9 billion Thursday. Match Group (MTCH), the online dating empire responsible for Tinder and OKCupid, was priced at $12 per share before its public open. By 11:00 a.m. EST, shares of Match had risen 12 percent to $13.40.