The linkup between GoHenry and Acorns is destined as both companies have been working together for some time already.
American financial technology and financial services firm Acorns has revealed it has acquired GoHenry, a teen-based investing application with a diversified user base. As reported by CNBC, the acquisition is the first of its kind for Acorns which is set to use the new acquisition to expand into Europe, in line with its global expansion strategy.
The financial cost of the deal was not revealed, however, the company’s co-founder and Chief Executive Officer, Noah Kerner noted that the terms of the acquisition are beneficial for GoHenry and its investors. The staff of the company will also roll over their stakes into the new Acorns world.
The Acorns outfit encourages value investing by permitting its users to invest their spare scare in assets like index funds. The company’s offerings will complement that of GoHenry whose primary goal is to instill financial education tenets in children aged 6 to 18. By its core operational model, the startup offers a spending card for kids and links it to a cash management application.
Typically, the application is managed by the parents who can limit spending among other functions. The GoHenry revenue generation model is hinged on charging for monthly subscriptions from parents, a model that also mimics the monthly subscription being charged by Acorns.
The linkup between GoHenry and Acorns is destined as both companies have been working together for quite some time.
“We pioneered the kids and teens with GoHenry, and Acorns very much pioneered investing and saving and bringing mental wellness to the up and coming, to everyday America,” said Louise Hill, co-founder, and chief operating officer of GoHenry, adding, “But both of us had ambitions to stretch beyond that in terms of customer demographics, so that we could start to serve people throughout their lifecycle, through all life stages.”
Acorns Acquisition of GoHenry, Not a Deal Born in a Hurry
According to the details shared by Kerner, neither the timing nor the acquisition deal was driven by the negative changes we’re seeing in the market today. He noted that the company looked at hundreds of deals before finally settling for GoHenry, a process that spanned several months.
The company said that as far back as 2020, it pioneered the launch of Acorns Early — an investment account for kids, pitching GeHenry as a viable option among the pack.
According to the plans being nurtured by Acorns, the name of the newly acquired firm will be changed to GoHenry by Acorns in the United States, while in the United Kingdom, it will be named as GoHenry. The startup will maintain the identity of its subsidiary PixPay in both Spain and France respectively.
With the financials not revealed, it is hard to tell what the Acorns valuation is as it was last valued at $1.9 billion following a $300 million fundraise last year. The firm’s plans to go public through a Special Purpose Acquisition Company (SPAC) were scrapped as a result of market conditions.