Acorns App Raises $300M, Brings Valuation to $1.9B

Irvine, Calif.-based FinTech startup Acorns has raised $300 million from private investors, CNBC reported on Wednesday (March 9).

Acorns specializes in micro investing and robot investing. Following the transaction, the savings and investment app is valued at $1.9 billion, more than double its last valuation, according to Acorns CEO Noah Kerner.

The Series F round was led by private equity firm TPG and saw participation from Bain Capital Ventures, BlackRock, Galaxy Digital and Thirty Five Ventures, the investment firm co-founded by Brooklyn Nets Forward. Kevin Durant.

The cash injection comes less than a month after the investing and checking account platform dropped its $2.2 billion initial public offering (IPO) with the special-purpose acquisition company ( PSPC) Pioneer Merger Corp.

“The markets have become very volatile,” Kerner told CNBC. “The concerns we had about [SPAC] market were that we would be grouped together in a group of companies that perhaps valued each other inflated.

In January, Kerner said Pioneer helped make Acorns a ready public company, but said they scrapped the deal due to market conditions and because the company was considering a conventional IPO.

See also: Investment platform Acorns cancels IPO with Pioneer SPAC

Founded in 2014, Acorns said it allows consumers to round up their purchases and use that spare change to invest in exchange-traded funds. Users can also invest additional money directly with Acorns, and the startup also offers checking accounts, retirement savings, and debit cards.

While Acorns’ $1.9 billion valuation falls short of the $2.2 billion target when it announced plans to merge with a SPAC, Kerner explained that’s because the company would have raised more cash through the SPAC.

“Private investors take a hard look at the companies they invest in,” Kerner said. “They look long and hard at valuations. I’ve had conversations where private market investors cut valuations in half.

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