On Monday, the personal finance and micro-investment app-maker Acorns announced an incursion into the European market with the acquisition of GoHenry and its French counterpart, Pixpay.
GoHenry, founded in 2012 in London, bills itself as a financial education company which gives children debit cards along with an app and “gamified money lessons" designed to teach kids and teens how to be smart with money from a young age. The company serves 6- to 18-year-olds and currently operates both in the UK and the US. With its acquisition of French fintech firm Pixpay, the company operates in France, Spain and Italy, as well. GoHenry's customers saved $130 million in the last five years alone, according to the company.
Acorns, which lets users make micro-investments in stocks by rounding up everyday transactions, was founded in 2014 in Irvine, Calif. According to the company, has 4.5 million customers who have invested over $16 billion, “much of it in spare change.” Acorns was initially backed by celebrities including Dwayne “The Rock” Johnson and Ashton Kutcher, and agreed to go public by merging with a blank-check firm Pioneer Merger Corp. in 2021, a deal that was later dropped.
Acorns anticipates that the companies combined will serve nearly 6 million subscribers globally.
“Providing age-appropriate tools and education from early childhood onwards can only benefit everybody involved,” said Philipp Hecker, CEO of Bento Engine.
GoHenry will become GoHenry by Acorns in the US, while the European brands will remain the same.
Financial Technology Partners is acting as the exclusive strategic and financial advisor to Acorns on its acquisition of GoHenry.
“This landmark, cross-border transaction brings together two leading consumer-focused fintech money management providers, forming a global leader,” according to a statement by Steve McLaughlin, managing partner of Financial Technology Partners, which acted as the advisor to Acorns in the deal.
This transaction represents one of the largest ever private-to-private consumer fintech M&A deals, said McLaughlin. Acorns has raised over $500 million in financing to date, while GoHenry has raised over $100 million since its founding in 2012.
Hecker said he views the deal as a win for GoHenry shareholders “not only as a function of the meaningful European market access Acorns will gain in one fell swoop, but also as a nod to the importance and value of timely and situational financial education.”
William Trout, director of wealth Management for Javelin Strategy & Research, said the acquisition of GoHenry was a logical next step for Acorns “as it seeks to build on its vision of micro-investing and expand that vision to individuals outside the US.”
“The built-in debit function will serve as an enabler of this vision,” said Trout. “At the same time, financial education represents an unsolved need for younger and less affluent savers, many of whom may struggle to balance credit, cash, investments and protection needs. As it builds bridges to UK and European investors, Acorns may be able to draw on technology and other learnings from GoHenry to accelerate growth in the increasingly competitive US market.”
