Acorns Grow Inc., the popular spare-change investing and checking account app, and Pioneer Merger Corp. are canceling their $2.2 billion blank-check deal for the app to go public.
The deal was canceled due to market conditions, and the startup now plans to raise funding and pursue a traditional initial public offering, according to Acorns Chief Executive Officer Noah Kerner.
“We really appreciate the partnership with Pioneer. They exceeded expectations and helped make Acorns public-company ready,” Kerner said in a statement. “Given market conditions, we will be pivoting to a private capital raise at a higher pre-money valuation as we continue on our path to 10 million paid subscribers saving and investing for a better future.”
Acorns and Pioneer join a growing list of companies to terminate SPAC mergers as the froth comes out of the once-booming market. Wynn Resorts Ltd.’s online betting unit, grill-maker BBQGuys and software provider ServiceMax have all nixed blank-check deals in recent months.
Acorns was founded in 2014 and charges users monthly fees to invest cash or spare change in a series of exchange-traded funds. It also offers checking accounts, retirement savings and debit cards.
The company is working on a new service for later this year called Customizable Portfolios that will allow users to invest a small portion of their money in individual stocks, Bloomberg News has reported. The expansion for Acorns into direct investing will help the app rival other mobile-first platforms like Robinhood Markets Inc. plus legacy services like ETrade and Fidelity.
At the time of its merger announcement, Acorns had 4 million subscribers. It’s grown since then.
“Acorns has exceeded its public forecast, crossed 4.6 million paid subscribers and helped everyday Americans save and invest over $12.5 billion to date,” Chief Financial Officer Rich Sullivan said in a statement.
Pioneer, a special purpose acquisition company, is led by Chairman Jonathan Christodoro and Co-Presidents Rick Gerson and Oscar Salazar. Christodoro sits on the boards of companies including PayPal Holdings Inc., while Salazar was a co-founder of Uber Technologies Inc.
In the original deal, Citigroup Inc. served as an adviser to Pioneer as well as the exclusive placement agent on a $450 million PIPE, or private investment in public equity. Moelis & Co. advised Acorns.
Pew survey reveals slight majority consensus on tax rates, but views splinter based on political alignment and income levels.
While the Federal Reserve's decision to hold interest rates steady in March was widely expected, it's the reactions from financial professionals that provide a more nuanced picture of the central bank's approach.
The pioneering member of Canada's Maple Eight is stepping back from its go-it-alone private equity approach as a drought in deals and Trump's trade war prompt a rethink.
The firms' latest additions in Florida and Nevada come as a strategic change at UBS raises risk of advisor defections.
The new program offers opportunities and events structured for rookies, next-gen advisor leaders, and soon-to-exit veterans.
In an industry of broad solutions, firms like intelliflo prove 'you just need tools that play well together'
Blue Vault Alts Summit highlights the role of liquidity-focused funds in reshaping advisor strategies
