AlTi Global, Inc.

Good afternoon. My name is Shamali, and I will be your conference operator today. At this time, I would like to welcome everyone to ALTI's first quarter 2023 earnings conference call. During the call, your lines will remain in a listen-only mode. After the speaker's remarks, there will be a question-and-answer session. I would like to advise all parties that this conference call is being recorded and a replay of the webcast is available on ALTI's Investing Relations website. I will now turn the call over to Lily Arteaga, Head of Investing Relations for ALTI.

Good afternoon to everyone on the call today. Joining me this afternoon are Michael Tiedemann, our CEO, Kevin Moran, our COO, and Christine Zhao, our CFO. Please visit the investor relations section of our website at www.alti-global.com to view our earnings materials, including our updated investor presentation, which provides more details on the topics discussed on this call. I would also like to remind everyone that certain statements made during the call are not based on historical facts, including any statements relating to financial guidance, and may be deemed forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Because these forward-looking statements involve known and unknown risks and uncertainties, there are important factors that could cause actual results to differ materially from those expressed or implied by these forward-looking statements. ALTI assumes no obligation or responsibility to update any forward-looking statements. During this call, some comments may include references to non-GAAP financial measures. Full GAAP reconciliations can be found in our investor presentation and related SEC filings. With that, I'd like to turn the call over to Mike.

Thank you, Lily. Good afternoon, everyone, and thank you for joining us today for our first quarter 2023 earnings call. The first quarter of 2023 was transformational for Altie. We entered the public markets through the completion of our business combination on January 3rd, and in parallel, we strengthened our balance sheet with a $250 million credit facility. For a brief summary of our Q1 performance, on a consolidated basis, Altie generated revenues of $58 million, adjusted EBITDA of $11 million, and ended the first quarter with $67 billion in assets under management and advisement. Our net loss for the quarter was $90 million, reflecting large one-off items related to the transactions and non-cash fair value changes totaling $89 million. Normalized for these unusual items, adjusted net income attributable to ALTI was $1.3 million, or $0.02 a share. Since the year end 2021, shortly after announcing the deal, we've grown our total assets by 12%, generated steady growth in our wealth management business, and our alternative strategies outperformed their competitive benchmarks in a historically challenging market backdrop. Later in the call, I'll provide more details on our financial performance, but I will say clearly, we still have work to do, And as a management team, we have established a clear path for value creation for 2023 and beyond. We're centralizing our operations and business development teams to enhance top line growth, addressing our cost structure to expand margins, and executing on strategic acquisitions that will accelerate our business in the years to come. We're excited about this strategic pipeline of opportunities, and we look forward to this next phase of growth. Before diving deeper on that path, I do want to reintroduce the firm to our public shareholder constituents. Alty has two business lines, a global wealth management platform with leading impact and multifamily office capabilities, and a robust alternative asset management platform, which includes both public and private real estate investment capabilities. For over 20 years, Alty's companies have structured their respective businesses to serve the needs of high net worth clients and institutional investors. We combine the service mentality of a dedicated family office with the gravitas of a world-class global institution investing across asset classes. We provide our client base access to some of the most sophisticated solutions available worldwide. Our business is focused on two pillars, investment solutions and wealth services. both of which are established and reinforced by a growing foundation of recurring revenues. For the wealth management business, our recurring revenues are generated from the comprehensive solutions and services we provide to large families, foundations, and institutions. These clients are distributed across the United States, Western Europe, Asia, and Latin America. Due to the breadth of our differentiated platform, we believe we will continue to attract teams, talent, and ultimately clients to serve. As it stands today, our wealth management business is one of the few global multifamily offices and the only one publicly listed. We've established a leading impact investment platform, which will continue to be a key driver of growth in future years as it is seamlessly integrated into our offerings. Our asset management business generates recurring revenues by providing growth capital, infrastructure solutions, and marketing support to alternative managers and real estate platforms. We deploy capital through minority investments and create long-term partnerships with the underlying managers. Alty portfolio managers are also recognized as domain experts and proven managers of risk. Our focus is to identify, invest into, and be an active growth equity partner to these specialist managers. We believe our long history of successful operators differentiates us from other sources of capital in our conversations when we approach these talented managers to discuss future partnership with Alty. Historically, these strategies have also generated co-investment opportunities for our real estate, public, and private market platforms. Currently, Alty operates in 22 cities across 10 countries and has a senior leadership team with depth and a proven track record of successfully integrating teams and driving growth post-integration. The industrial logic behind the forming of Alty was to address and participate in macroeconomic trends that will shape wealth and asset management in coming decades. High net worth individuals represent over $470 trillion of global wealth today, on a projected path to more than $600 trillion in 2026. Approximately $70 trillion of that market is changing hands and transitioning to younger generations, namely Gen X and millennials. These generations are more focused on impact and value-based investing, innovation economy, and ultimately receiving those services from an independent advisory firm that aligns with their core principles. Additionally, we see increasing demand for alternatives across investor classes. From institutional investors to family offices to ultra-high net worth individuals, demand for alternatives have come into full focus over the past few years. The alternative management total addressable market is estimated to grow to $23 trillion by 2026, representing 11% CAGR since 2011. Alti is serving a large and rapidly expanding market with a unique set of solutions. Even amidst recent market volatility, we have more conviction than ever in our founding thesis and the industrial logic of our combination. With that said, interest rate hikes and ongoing market volatility present an opportunity for us to lean into our strengths and go deeper into our core business, wealth and asset management. We spent close to 15 months closing the business combination and emerged as a public company in a very different market. The cost of debt capital has more than doubled. The banking system has come under intense pressure. and private markets are undergoing a period of repricing rarely seen. For ALTI, this 15-month period meant the three private businesses bore much of the cost burden associated with operating as a public company without the benefits of being one. We lacked the ability to execute strategic transactions as we went through the audit and SEC review period. Additionally, due to regulatory restrictions, we were unable to execute on growth and cost synergies. which will be an important offset to public company costs. Despite these headwinds, our wealth management business has grown steadily and our alternative strategies are consistently producing uncorrelated returns, proving their durability in challenging markets. Since closing the business combination in January, our executive team has gained expanded visibility into our entire organization. I'll now ask Kevin,