Jim Cramer: Robinhood pushed Charles Schwab to deal for TD Ameritrade

• "Earlier this year ... Robinhood reached a tipping point in asset gathering that the incumbents, like Schwab and TD Ameritrade, had to respond to by abandoning commissions," CNBC's Jim Cramer says.
• "Now these companies have to combine to cut tech spending ... ad spending to defend their turf" from app trading, the "Mad Money" host says.

Robinhood and the "creative disruption unleashed by Silicon Valley" forced the potential merger between Charles Schwab and TD Ameritrade brokerage firms, CNBC's Jim Cramer said Thursday.

It's the latest sign that companies must "invent ... disrupt ... or die," the "Mad Money" host said. The incumbents didn't see Robinhood coming to change the status quo with commission-free trading, he added.

"Earlier this year ... Robinhood reached a tipping point in asset gathering that the incumbents, like Schwab and TD Ameritrade, had to respond to by abandoning commissions," he said. "Now these companies have to combine to cut tech spending ... ad spending to defend their turf" from app trading.

The possible Schwab-TD Ameritrade deal would create a brokerage worth more than $5 trillion in total assets. The Robinhood start-up, founded in 2013 and boasting 6 million users, can't be ignored after building a $7.6 billion valuation as of July.

The mobile app is planning to expand its commission-free trading business to the U.K.

Luxury jeweler Tiffany & Co. is another company that could change ownership hands because of technology, Cramer pointed out. French luxury group LVMH recently made a nearly $16 billion bid for the company. LVMH, whose brands include Louis Vuitton and Hennessy, has made use of customer relationship cloud company Salesforce to provide a better experience to its customers, Cramer noted.

Tiffany's lack of technology means it's lacking what other retailers utilize, he said.

"Prospective mergers, disruption, invention [or] die — the latter is what happens when you can't figure out how to use technology or won't spend the money," Cramer said. "And when that occurs, let's just say the entrenched incumbents out there, they either learn it sooner, or, unfortunately, later."

Disclosure: Cramer's charitable trust owns shares of Salesforce.com.

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