Instreet Investment Limited, an Australian asset manager with $500 million under management, has taken a controlling stake in the local arm of micro-investing app Acorns.
The deal is through Instreet subsidiary Instreet Acorns Pty Limited which has increased its holding in Acorns Grow Australia Limited. Neither the size of the holding nor the payment required were announced.
Fintech Acorns has had more than 550,000 downloads of its app in Australia, building more than $150 million in funds under management in under two years.
The app can be set up to take one off or recurring investments or use spare change, rounding up purchases and investing the difference. For example, if you spend $8.50 on lunch, Acorns will invest 50 cents.
Acorns charges no brokerage fees and has one of the smallest minimum investment amounts in the industry. The average Acorns user made 10.5% a year to the end of July 2017 on their investment after fees but before the $1.25 monthly subscription fee.
In the US, where Acorns was started in 2012 by father-son duo Walter and Jeff Cruttende, the app has more than 2.9 million accounts.
Last year, Acorns raised $US30 million in the US in a funding round led by PayPal, bringing its total funding to $US102 million.
In Australia, Acorns Grow Australia Limited was a joint venture between Instreet and US-based Acorns Grow Incorporated. Acorns Grow Incorporated will keep a minority interest in the new ownership structure.
Acorns Grow Australia will rebrand its business over the coming months.
The deal gives Acorns Grow Australia a perpetual licence to operate in additional markets in Southeast Asia, including New Zealand, Indonesia, Singapore, Malaysia, Thailand, and Vietnam.
Acorns Grow Australia has also granted a perpetual licence to Acorns Grow Incorporated for technology it has developed.
Instreet Managing Director George Lucas will continue to oversee operations in Australia
NOW WATCH: Money & Markets videos
Business Insider Emails & Alerts
Site highlights each day to your inbox.