Walter Cruttenden has been the wearer of many hats over his eventful career.
He first gained fame in local business circles in the 1980s forming and running what’s now Roth Capital Partners LLC, Orange County’s largest investment bank.
He also founded SRS Laboratories, an audio technology platform that provides surround sound technology—that firm sold in 2012 for about $148 million. He also in 1999 founded the online investment bank E-Offering, which became part of E-Trade Financial Corp.
More recently, he’s become the “Father of Fintech” in Orange County, helping to launch a series of area firms designed to help younger investors save and make money through a variety of means.
“There is a savings and investment problem in America, with about 40% of the population unable to cover a $400 emergency expense,” he told the Business Journal in October.
There’s a common thread between the varied industries he’s been involved with, Cruttenden said.
Through it all, “there’s been a lot of experimenting, and it’s a pretty fun process,” he said last month.
“I’m really just in the business of starting companies.”
Cruttenden’s role on shaping and growing the area’s startup scene, and his recent success bringing micro-investing to the masses, earned him the Business Journal’s Business Person of the Year award for the innovation sector.
Culture, Success
Cruttenden co-founded Acorns Grow Inc. in 2012, which has quickly become one of the most popular micro investment apps in the world.
Among other services, Irvine-based Acorns rounds up users’ spare change from online transactions to the nearest dollar and invests the money into a variety of funds.
The firm made headlines earlier last year when it closed a $105 million Series E round at an $860 million valuation.
It’s among the highest valuations for a local startup in recent years—second only to Palmer Luckey’s Anduril Industries which reached unicorn status in September (see story, page 1).
It brings Acorns’ total amount raised to more than $250 million. Corporate backers include BlackRock Inc., NBC Universal, and PayPal.
That’s not to mention a few high-net-worth individuals including Ashton Kutcher, Bono, Jennifer Lopez and Alex Rodriguez.
Cruttenden said that through all the successes, the company’s secret sauce has been maintaining a “lean and agile startup mindset.”
He added that credit at Acorns should go to CEO Noah Kerner, who provides almost every employee with stock options and is willing to listen to anyone’s ideas.
Moore’s Law
Acorns has about 5 million clients and more than $2 billion in assets under management, according to recent data. That’s about $400 per person.
When Cruttenden founded Acorns with his son Jeffrey Cruttenden some five years ago, micro-investing was only a concept.
“It’s Moore’s law that made it possible,” Cruttenden explained, citing the observation that computing speed is often expected to double every few years.
“As computers get more powerful, and there are more out there, then more functionality becomes available at a lower price, and this in turn, affects financial markets.”
In other words, as products become more common, the price goes down and it becomes accessible to a larger population. That, in a nutshell, allowed Acorns to take off.
Fintech, Gaming
Once Acorns began to make headway and Cruttenden realized that micro-investing was possible, he started to look at other ways to engage a younger audience and create more financial wellbeing.
He soon turned his attention to fintech and gaming—which he believes are destinated to merge—with his other son, Alex Cruttenden.
The duo, along with a small team, quietly formed Blast in 2017 and subsequently launched an Android app that allows users to save and earn money while playing games.
The company went on to raise a $12 million seed round and garnered the attention of online game developers including San Francisco’s Zynga and Pocket Gems.
Most recently, Cruttenden and his team launched the Blast platform on Apple and PC products, which has allowed the company to gain traction among the gaming and esports community.
He declined to comment on the company’s future, only to say, “We have installed fintech pipes under half of the world’s most popular PC games.”
Entrepreneur, Innovator
Cruttenden’s most recent startup was announced earlier this year. He launched ATM.com with CEO Mike Gleason. The company’s platform is designed to allow users to pool and sell their online data.
A source close to the team said the site is rumored to launch any day now.
While Cruttenden savors his successes, he never hangs on to them for too long.
He said he’s always looking for his next experiment.
