- Why this is important: Altacrest Capital leverages its partners’ experience in consumer products and business-to-business to make deals
Tim Laczkowski is taking the skills he learned after working 15 years at Prudential Capital Group and using them in buying and growing lower middle market businesses.
Laczkowski formed independent sponsor Altacrest Capital in 2017 to invest in consumer products and business-to-business services.
“PCG prepared us well to pursue our strategy of growing lower middle market businesses,” said Laczkowski. “We utilize what we learned investing in larger companies from a large institutional platform to focus on the needs of companies smaller in size than we pursued at Prudential.”
Last year, Altacrest acquired watch strap company Barton Watch Bands from founder Scott Herz in 2018. The firm sources capital from several high net worth individuals and private investment firm Route 2 Capital Partners.
“He wanted someone else to grow the business and liked our approach and style,” Laczkowski said of Herz. “We have relationships with operators who provide advice, support and leadership to our portfolio companies.”
Barton Watch Bands makes all its sales through its website and Amazon. The company fits perfectly with Altacrest Capital’s focus on investing in businesses in the consumer product sector, particularly those that specialize in e-commerce.
“Using e-commerce as a sales channel, we can grow that channel with some of the techniques and the background that we have,” said Laczkowski.
Altacrest targets companies with a minimum Ebitda of $2 million, according to its website.
“Our strategy is to take companies with strong free cash flow [and are] asset light and help build those businesses for long-term growth,” Laczkowski said.
Altacrest likes the flexibility that the independent sponsor model provides compared to traditional private equity funds and believes that the amount of capital the market sees today positions Altacrest to be successful.
“We like the model because it allows us an opportunity to look at different types of businesses and use different types of investors to facilitate those transactions,” he said.
“There can be some issues with having a fund and the time horizons to invest a fund can make some challenging decision making for PE fund managers because they have a timeline. We don’t have those type of constraints or issues to deal with.”
Laczkowski is joined by Partners Rick Sukkar and Brien Davis. Sukkar joined in 2018 after spending 14 years as executive director at JP Morgan Securities Inc., nearly three years as president of truck and bus repair company On Site Fleet Services and over three years as president and COO of Monster Moto LLC.
Davis joined the independent sponsor in 2018 after working with Laczkowski at Prudential Capital Group for 14 years.