The slick smartphone app that automatically invests its users money based on a funky formula is gaining momentum with young and first-time investors.

Opening and managing an investment account can be intimidating for a lot of people, but what if a simple smartphone app could take care of it all for you?
Acorns, a eight-month old smartphone app built for exactly that purpose, said Wednesday that it had raised $23 million in additional funding.
Acorns’ app was designed to help people, especially first-time investors, get started in investing with small automated investments into a portfolio of exchange-traded funds, or ETFs, that the company selects and balances. Users link their bank accounts to the app, which then automatically rounds up the cost of all transactions to the nearest dollar, withdraws that spare change and invests it. For example, if you buy a coffee for $2.40, Acorns will take an extra 60 cents and invest it in an exchange-traded fund.
Acorns’ two-pronged approach to making investing approachable by automating the process and incorporating a smartphone app is paying off with younger users. Of Acorns’ 650,000 registered customers, 75% are under the age of 35, Cruttenden said.
He added that of the $100 users invest monthly on average, $55 comes from through automated withdrawals using the formula involving the rounding up the value of transactions. It shows that people are drawn to this type of hands-off approach, he said. The rest of the money is from users making voluntary lump-sum investments.
Acorns’ six portfolio options are designed with different risk levels, and are regularly and automatically balanced based on their performance. 
Currently, Acorns charges a $1 monthly fee for accounts with a balance under $5,000, and 0.25% per year for accounts larger than that.