Fourteen years after launching Canterbury, however, Flint found himself at another crossroads. Canterbury had a broker-dealer, so it was taking both commissions and fees, which Flint saw as a conflict of interest. By that point, however, he was unable to change the firm he had helped start from within, and he found he had to move on again.

It was about the same time that his daughter was looking for change too. Eusey, a marathon runner with four kids of her own, had risen through the ranks at Roxbury Capital, a growth stock shop, starting as an intern in 1994 when it was a billion dollar firm and leaving there eight years later as managing director when the firm had $15 billion. After Roxbury was bought by Wilmington Trust, she took a detour to grad school.

The business plan for Beacon Pointe was written during her MBA program in August 2001 by Eusey and three others in an entrepreneurial class, and they laid out the premise: “Over 7.2 million individuals have financial assets in excess of $1 million,” the report read. (Eusey, when asked, can still fetch the plan from under her desk.)

“We identified a problem that the wealth management business has been highly fragmented because it’s product-centric,” Eusey says—and hampered by distinct sales channels across regulated industries. “There’s broker-dealers, there’s money managers, insurance folks, but nobody has really taken a hold of wrapping it all together. No one has taken a holistic approach yet looking at the client and saying what is best for you, client, working as a whole.”
She and her classmates got a “B.”

The idea was also to approach the entire RIA business differently—and get producers out of the business of running the business. Eusey, new MBA in hand, was charged with figuring out strategic marketing and business plans and running the firm day to day so everyone else could focus on their talents.

Like all firms, this one made mistakes. “Because we’re so entrepreneurial, a lot of ideas get thrown up, and sometimes the ideas are not the best ideas, but we’ll chase an idea down the rabbit hole.” The firm, reflecting its non-profit roots, is also conservative toward investments and drifts toward managers who stress valuation, she says. Matt Cooper adds that the firm had to buy out one of the early partners fairly early, which also caused a setback.

“In hindsight, you think what on Earth were you people doing?” Eusey says. “We didn’t pay ourselves for the first year. My dad was in the late stage of his career. Matt Cooper [had been] making a ton of money [at his previous job]. But it was really true, we felt to the core that we have something special. … Failure was not an option.”

Adds Eusey, “We talked about doing the full-service, myCFO type of work which we didn’t go into because we thought, my gosh, the bill paying and all that other stuff is probably not a huge value add to clients, but I’d say over the last five years, we’ve really evolved into more of financial planning as a key focus of the firm, equally important as the investments. Because if you don’t have the right planning, it’s very hard to structure the right relationship with the client.”

The institutional bias started to change quickly. A huge boon came in 2004 when the firm got onto the Schwab Advisor Network retail referral program. “The result of that was we were bringing in $120 million [the first couple of years] just from that channel, which then spread our footprint,” Cooper says. Ironically, the firm almost turned the referral network down because it meant lowering account minimums, which it thought would dilute the brand offering.

A big selling point is the firm’s research and manager screening, which Flint wanted to stress at the new firm. Beacon Pointe works with both separate account managers and mutual funds, but likes boutique firms that are employee owned with disciplined, repeatable processes. The firm has 90 different mutual funds and separately managed accounts, and about 15% are alternative strategies—hedge funds, private equity, real estate, venture, etc. But Cooper says alternatives don’t usually wind up in more than 5% of a private client’s portfolio. The firm likes long strategies.