Constellation Wealth Capital, Karl Heckenberg’s RIA minority investing firm, has officially completed its first deal following its launch earlier this year: a strategic investment in AlphaCore Wealth Advisory. Citywire spoke with AlphaCore CEO and founder Dick Pfister, CAIA, to provide an inside look at this new partnership and its potential impact on the future of the alternative investments-focused RIA.
According to Pfister, Constellation’s investment coincides with a pivotal moment in AlphaCore’s growth trajectory. “For the last eight years, we’ve been taking every dollar of P&L and putting it right back into the business. It’s always a battle between reinvesting in the business or booking profits, and we didn’t want to stop our growth trajectory,” says Pfister. “But we reached a point in our growth where it was obvious that, for us to hit the next level of customer service, we needed to bring more talent in-house.”
Pfister mentioned that AlphaCore plans to use the funds from this investment to hire about a dozen employees throughout the next year and invest in the buildout of white-glove family office services. The proceeds from the deal will also support AlphaCore’s dealmaking activities, continuing the pattern of the firm’s recent acquisitions of Johnston & Associates and Magnolia Lane Financial Advisors earlier this year.
“Our pipeline grew larger and larger as time went on, and we had opportunities in front of us that we may have said: ‘Okay, we’re not ready for that yet.’ That’s part of the impetus of bringing in somebody like Karl — it gives us some cash on the balance sheet to go out and do some acquisitions,” Pfister explains.
Meanwhile, Heckenberg tells the publication that Constellation sought a partnership with AlphaCore due to the firm’s distinctive qualities and unique strengths. “We are thrilled to partner with AlphaCore,” he states. “AlphaCore’s impressive growth track record, innovative approach to wealth management and expertise in alternative and private markets investing align perfectly with CWC’s investment philosophy.”