A group of senior executives from Affiliated Managers Group, the $10 billion (market cap) investor in asset management firms, has launched a new business to invest in smaller registered investment advisors.
Newly formed Wealth Partners Capital Group launched with minority investments in three firms: Forbes Family Trust, Cleveland-based MAI Capital Management and EP Wealth Advisors of Southern California. John W. Copeland, who stepped down as president of AMG Wealth Parnters to launch WPCG, said the plan was to use these three firms as “hubs” to acquire other RIAs.
“As the independent wealth management industry continues to grow and mature, a long-term solution for smaller firms in need of business and operations support will be critical. We believe FFT, EPWA and MAI offer compelling opportunities to these firms,” he said. The focus will be on smaller RIAs under $1 billion in assets.
The management teams of each firm will continue to hold a majority of the equity in their business and control of day-to-day operations.
The three firms combined have some $11 billion in AUM. AMG was an investor in Forbes Family Trust, and transferred that ownership to WPCG as part of its investment in Copeland’s new firm. All three were chosen, he said, because they have “a strong regional brand, deep management and operational talent, extensive financial planning and investment capabilities, and a dedication to the client experience.”
“What initially impressed us about MAI was the extent to which they constructed everything around true client service,” said Rich Gill, Senior Partner of WPCG. “Rick [Buoncore] and his team built a firm that is designed to anticipate the needs of clients and their families. We believe what MAI has built can be a terrific solution for advisors around the industry.”
“Smaller, independent firms are increasingly challenged by regulatory and compliance costs, rapid changes in technology and security and limited succession planning,” said Rick Buoncore, Managing Partner at MAI. “We believe the partnership with WPCG creates a compelling opportunity for a firm of our size, scale, and caliber to support and partner with other quality advisors.”
“While many in our industry are adopting more robo-based investment services, we’re doubling down on personal touch,” said Patrick Goshtigian, president of EP Wealth Advisors. “Money and investments are highly personal issues, and our advisors and staff are driven to make an impact on our clients’ lives and look after all aspects of their financial health. That requires tremendous support. We help advisors by handling back office support, investment management, financial planning, and other non-advisory aspects of running an independent, fiduciary firm.”
AMG Wealth Partners, while an investor in WPCG, still retains investments in wealth management firms with a collective $40 billion in AUM. Last year AMG made investments in the $7 billion AUM MyCIO Wealth Partners and the $6 billion AUM Baker Street Advisors.