Part of becoming strong in Bit Heroes is from fusing familiars together. To fuse two familiars together go to the main town screen and tap familiars. This will pull up a complete list of familiars with portraits of familiars you have not obtained quite yet appearing as black silhouettes.
Tap the green fusion button at the bottom of the window.
The fusion requirements will be listed along with the end result for fusion schematics that have been unlocked. Tap the fuse arrow to create the new familiar.
Keep in mind by fusing two familiars you will be consuming both of them. It's also worth noting some familiars have multiple fusion options. For collectors it can be a good idea to recruit duplicates of the same familiar type.