Constellation Wealth Partners, the private equity firm founded by former Emigrant Partners CEO Karl Heckenberg focusing on wealth managers, has closed its inaugural fund with more than $1 billion in capital commitments.
The Constellation Wealth Equity Fund includes partners ranging from insurance companies and endowments to foundations, asset managers and funds of funds. According to the firm, the fund was oversubscribed and Heckenberg highlighted the “significant market opportunity” to work with wealth management firms at “turning points” in their growth paths.
“We believe our deep sector knowledge, experience and ability to provide tailored capital and advisory solutions make us an ideal partner for wealth managers focused on building profitable businesses over the long term,” said Heckenberg.
Heckenberg founded Constellation in late 2023, seeking to take minority stakes in growing wealth management firms nationwide, offering fund investors risk-adjusted returns.
Constellation provides growth capital to organically and inorganically growing firms, as well as additional services to enhance and scale their performance and recruit and retain talent.
According to John Langston, founder of Republic Capital Group, Constellation seeks long-term investments in firms that need relatively smaller bursts of cash. This fills a void left by large private equity firms, which typically write larger checks. According to SEC filings, Constellation's business model involves investing between $25 million and $200 million in firms that manage between $1 billion and $200 billion in client assets.
Since forming in late 2023, Constellation Wealth has made eight investments from its first fund, including the first in AlphaCore Wealth Advisoryas well as AITi Tiedemann Global, Avior Wealth ManagementCV advisors, Lido Councillors, Perigon Wealth Management and Necessary capital management.
Additionally, the firm announced earlier this month that it had taken a minority stake in Cresset Asset Management. Constellation invested $150 million, representing less than 10% of Cresset's total capital. The firm expected to use the funds to improve its technology and recruit advisers. (The firm remained majority owned by employees and customers.)