Acorns is an 8-month-old app that makes investing spare change dead simple, and it just raised $23 million

Acorns, an eight-month-old app that lets you automatically invest spare change when you make purchases with your credit or debit card, just raised $23 million in a Series C round of funding.

Yes, you read that right: An app that's only been live for eight months is already on its third round of financing.

That's because the company was actually founded in 2012 and an Acorns spokesperson says the app has seen "incredible growth" since its mobile debut in 2014.

The new funding, co-led by Greycroft Partners and e.ventures with participation from Sound Ventures, Garland Capital, and MATH Venture Partners, brings Acorns' total funding to $32 million.

When Acorns' cofounder Jeff Cruttenden was in college, he realized a lot of his friends - many of whom studied economics or finance - didn't have their own investment accounts.

"It was really striking," Cruttenden, whose dad set up a small investment account for him when he was young, says. "These people talked about investing all the time, but they didn't have their own accounts." Cruttenden and his father co-founded Acorns together.

Cruttenden says there are three main reasons people don't invest: It's difficult to get enough money together to get started; commissions often make it hard to invest even $100 at a time; and most importantly, new investors face too many choices - stock funds, mutual funds, ETFs. It's overwhelming if you're just getting started.

"If we could distribute investment accounts like an app and not like traditional investment services, we could tap into a market that's been disenfranchised for a long time," Jeff says.

Jeff and his dad Walter set out to build their own platform to make investing easy and to reign in people who would otherwise be too intimidated or overwhelmed to start investing.

Acorns works by letting users invest their change. You link up your credit or debit card to your Acorns app. Every time you use that card to make a purchase, Acorns rounds your purchase up to the next dollar and invests your change into a diversified portfolio of index funds, which are selected by Harry Markowitz, a Nobel prize-winning economist.

"We're finding that having people invest that way is powerful," Cruttenden says. "If we ask someone to invest $50, for example, that's emotionally difficult to part with. but $1 fifty times or 50 cents a hundred times is much easier. It's helping people get started with investing."

The app works because it takes little action on the user's part: even if you're a brand-new investor with limited knowledge of investments and economics, Acorns lets you quickly and automatically invest small amounts of money as frequently as you make purchases. Acorns charges a small monthly free - a percent of your account's balance.

Acorns, which was founded in 2012, grew from "between 20 and 30 employees" at its launch eight months ago to 80 now. In the past eight months, Acorns says it's grown to more than 650,000 members, opening over 300,000 investment accounts and linking over one million credit and debit cards. 75% of Acorns' investors are under 35.

Jeff tells Business Insider that the new funding will help Acorns continue to scale and innovate. He says platforms for wearables and the desktop are coming next to complement the mobile Acorns app. The company also plans to expand globally in the next 12 months.