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MAI Capital Management''s office. MAI Capital Management

RIA Edge 100: MAI Capital Management

Preparing to celebrate its 50th anniversary this year, MAI Capital Management has grown by at least 170% since 2017 while maintaining an impressive level of client service, adding capabilities and developing a strong acquisition model.

When Rick Buoncore bought McCormack Advisors International in 2007, the ad hoc firm was barely making a profit after separating from International Management Group, a company best known for reinventing sports management with a handshake agreement between founder Mark McCormack and pro golfer Arnold Palmer in the mid-1960s.

“It’s the absolute best thing I’ve ever done,” said Buoncore today—aside, “obviously,” from marrying his wife and having children.

MAI Capital Management, rebranded under Buoncore, will celebrate its 50th anniversary this year. The Cleveland-based firm has been growing at a faster clip than many of its peers while maintaining an impressive level of client service, adding capabilities and developing a strong acquisition model. MAI is also implementing a new marketing initiative that will compensate top athletes for promoting its services to colleagues in their respective fields.  

Founded in 1973 under the name Investment Advisors International, MAI was initially created to provide specialized wealth management services to the world-famous Palmer, adding features such as tax management and bill paying as he and his wife needed them. Eventually those services were extended to other successful athletes, primarily introduced to the firm through an agent.

By the time Buoncore arrived on the scene, McCormack had passed away, IMG had been sold to Forstmann Little, and the family was looking to offload the wealth management practice. Client assets were dwindling due to a flagging lead pipeline, but the affiliate had built up significant services, developed a potentially scalable family office model and had valuable connections in the world of professional sports. Buoncore, who had just left a wealth management division of KeyCorp to launch his own firm six months earlier, saw potential.

“[McCormack] didn't really think of this as being in the wealth management business. He thought of it as taking care of his clients and making sure they were financially well because, especially, athletes don't have a great history of surviving their wealth. It’s not necessarily their fault, but it does get away from them,” Buoncore said. “Little by little, as he listened to what they needed, he built it. When I ‘inherited’ it, it was a great, great service but it was clearly not a business.

“The one thing they did that I loved,” he said, “was take care of the client.”

Buoncore acquired the $900 million practice on Feb. 1, 2007, and the McCormacks remain his biggest client.

Rick Buoncore MAI Capital

MAI Managing Partner Rick Buoncore

Since then, MAI has built “the most complete sports business in the country,” said Buoncore, alongside a family office serving clients at all income levels and a brand new retirement services division, all augmented by partnerships with Fidelity and Schwab that brought in $700 million in new assets last year alone. The firm is also considering building in-house trust capabilities as an ongoing search for a potential acquisition has proved fruitless.

Two private equity investments also supplied MAI with a formidable mergers and acquisitions lead engine provided by Wealth Partners Capital Group and access to tens of billions in untapped assets through Galway Holdings’ EPIC-affiliated insurance businesses.

Among the firms on the RIA Edge 100 list, MAI now has close to 400 employees—including 135 client-facing advisors with 55 CFP certificates between them—managing 7,049 client relationships and $15.4 billion in assets. The firm grew by 169% from 2017 to 2021, according to data gathered by Discovery Database, WMIQ and RIA Edge, and 114% year over year between 2018 and 2021.

"We've been on a little bit of a tear and it's not going to stop anytime soon," Buoncore said. "We think we've created a really nice little model and it may not be right for everyone, but for those that it fits, it's a nice scenario."

Buoncore always knew MAI was going to be big. He said he may have added staff a bit prematurely­—hiring early for all the positions to which he was accustomed in the banking sector—but it was the firm’s management team and range of services that ultimately set him up to attract financing from WPCG in 2017. The firm offered to take over M&A sourcing and due diligence in return for a minority stake.

“That, to me, was the first major inflection point,” he said. “Maybe I got ahead of it a little bit, but they really liked the fact that we had this broad platform where we could service any client from a million dollars to a billion. And then, in addition to that, we had a real management team. It wasn't like, ‘OK, who's going to manage this?’”

MAI made its first acquisition in June 2019, bringing on MTX Wealth Management founder Steve Trax to lead the MAI Sports + Entertainment division, which officially launched in the fall of 2020 and manages around $4 billion in assets.

The firm went on to complete dozens of acquisitions with WPCG’s support, growing AUM from $5 billion to $12 billion during the first four years. In 2020, Galway Holdings, which owns two of the nation’s largest insurance providers, took a majority interest in the business to tap into synergies with Galway’s retail insurance arm, EPIC.

“There's roughly $80 billion of opportunity there, assets that are not currently managed by anyone in Galway that we now have an opportunity to go try to manage,” said Buoncore. “They also have P&C in life and things like that, so we have a better opportunity to deliver great service and great solutions to our clients because of our partners. And they have a great employee benefit program, which gives us the ability to sell our 401(k) into it and all the other services that go along with that.”

MAI’s ability to provide clients at all income levels with everything from financial planning, investment and tax management to things like bill paying and making travel arrangements sets the firm apart from its peers, said Buoncore. To ensure scalability, quality and continuity, all acquired firms are required to adopt MAI branding, services and processes. Individual client relationships remain the purview of the advisor, but virtually everything else is managed centrally and dedicated teams are specialized in areas such as acquisition integration, investment management and data entry.

The firm has big plans for continued growth, aiming to reach $50 billion in assets over the next few years.

“I can see $50 billion as clearly as I can see the hand in front of my face,” said Buoncore. He expects the firm’s newest marketing initiative to play a significant role.

Due to a change in SEC regulations, MAI is now able to compensate professional athletes who act as brand ambassadors among peers and colleagues with more than $2.2 million. Currently, the firm is in talks with a prominent hockey player to become its first paid spokesperson.

“This is someone people look up to,” said Buoncore. “To have him telling other hockey players about us creates this incredible opportunity set and there’s really no risk to us. And we have big names in every sport as our clients.”

For advisors looking to unlock their own growth potential, Buoncore said it’s important to be hyper aware of both strengths and weaknesses, and to be sure that growth is the goal because it requires significant financial and personal investment to achieve.

“Do you have a lifestyle, or do you have a business,” he said, “There’s nothing wrong with either one, but, if you want a lifestyle, you don’t really need to do a lot of the things we did. You could make quite a nice living, but it’s not going to be a business … but, if you’re not happy with that, then do something about it, work harder, figure it out. Understand what you have and either accept it or make the required changes to get what you want.”

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