Failure isn't option' at May Davis Group

High energy: In 1994, two men hatched their growing investment banking business in a stuffy office on East Redwood Street.

January 21, 2001|By Bill Atkinson | Bill Atkinson,SUN STAFF

NEW YORK - A cardiac ward is the first thing that comes to mind when you're walking through the Manhattan offices of the May Davis Group Inc.

The two founders of the Baltimore brokerage and investment banking company couldn't be more different, except that both are cranked tighter than lug nuts after a tire rotation. You wonder whether the next call will be to 911.

But for Owen May and Kevin Davis, the pressure of deal-making and running their own company is paying off.

Since opening the doors in 1994, the May Davis Group has grown from a two-man operation to about 50 employees, most of whom work in its swanky New York offices on the 87th floor of the World Trade Center.

The company raised nearly $400 million for clients in the past 13 months, its most ever. Revenue last year doubled, to $11 million, although the company was not profitable. And its business includes clients who have operations around the world.

"We are making a name for ourselves," said Davis, 43, who is trying to break his Newport Lights habit. "In terms of revenue, we have really been rocking and rolling."

May, 42, who is built like a running back and speaks in a booming voice, said, "We do deals. We are here to do deals."

Both men seem incapable of sitting still. Even while being interviewed, Davis rocks incessantly in his chair and sifts through papers, fidgets with his black, pin-striped suit, and paces, ultimately gazing out a window at the sweeping view of New York's harbor.

May punches numbers into a calculator, flips through more papers and makes a couple of quick telephone calls.

"Did I give you my Palm Pilot?" he asks someone on the other end of the phone.

Despite the demands of the business, May and Davis have simple goals. They want to keep their business small, with fewer than 100 employees, and build a vibrant investment banking firm targeting small and medium-sized companies.

However straightforward the plan, there are challenges that include hiring the right people, raising capital and competition.

May Davis is small in the world of investment banking but winning its share of deals.

It raised $10.2 million for Forefront Inc., a Web technology company in Sarasota, Fla., this month, and $5.3 million for Inc., an Internet company involved in electronic commerce.

"They are meticulous ... and they are easy to work with," said Kenneth Van Meter, chairman and chief executive of Celerity Systems Inc., an interactive television hardware and software company in Knoxville, Tenn., for which May Davis raised more than $6 million last year.

Adam Shuster, chief operating officer of Televend Inc., an Israeli company that is developing software to enable people to make financial transactions through their cellular phones, hired May Davis to raise $3.5 million to $4 million in a private offering. "They have been giving us 24-hour attention."

Last year, May Davis grabbed little pieces of several huge deals, including AT&T Wireless Group's initial public offering, which raised more than $10 billion, and TyCom Ltd.'s public offering, which raised nearly $2 billion.

"We have come miles, we have come eons from where we started," Davis said.

May and Davis met in biology class at the University of Miami in Florida. Their meeting, they say, was inevitable. "There were 18,000 students and 500 black kids," Davis said, letting the numbers speak for themselves.

After graduating in 1980, May earned a master's degree in business at Duke University and Davis enrolled in graduate school at North Carolina Central University.

May landed a job at Shearson Lehman Bros. in New York, and he told Davis about the money that could be made in the brokerage business.

Davis left graduate school to join a small brokerage firm in Colorado, and by 1990 he returned to his home town, Baltimore, to work for Chapman Co., a brokerage and money management business that has since become Inc. There, he became head of institutional equity sales.

While at Chapman, Davis approached May about starting an investment banking business.

By Christmas 1992, the two had holed up in May's Upper East Side apartment in New York and hashed out plans over a long weekend to form the company.

They pooled their savings and borrowed money from May's father-in-law, and two years later, the May Davis Group was born in a cramped, stuffy office on East Redwood Street in Baltimore.

"Failure wasn't an option for us," Davis said.

The partners didn't wait long to expand. Two months after opening, May Davis set up an office in New York, where it could tap a larger pool of brokers and investment bankers.

In 1997, it hired away the institutional equity division of troubled W. R. Lazard & Co., once the largest black-owned investment banking company in New York. The deal added five employees, boosting May Davis' work force to 15.

A year later, it hired five investment bankers from AIBC Financial Corp. And in 1999, it added about 20 retail brokers from H. J. Meyers & Co., a defunct brokerage in Rochester, N.Y.

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