A big concern in the VC community after the series of disasters beginning with the Facebook IPO fiasco was whether we had seen the end of the recent increase in IPOs and eagerness to pay $1B valuations in private companies. A key test of that worry has now been successfully passed: Square was able to raise a big round of over $3B valuation, at around its ask level. We also saw Yammer got bought by Microsoft for $1.2B and Kenexa got bought by IBM for $1.3B. This may signal a shift more towards consumerized enterprise deals, but we still see a robust incoming pipeline of consumer and mobile deal flow. It may be the end of the beginning, but it is not yet the beginning of the end.
Another insane private equity valuation does not a worry subside
At this stage, this continues to appear like more of the same that Groupon, Facebook and Zynga have suffered, though clearly Square is not a consumer play. The analogs you listed were M&A, which has seen some insane valuations as well (Yammer being a prime example of that, but Buddy Media being a close second). The true test will be their entry and performance in the public markets, if that happens any time soon.