While taking an entrepreneurial class for an MBA at the University of California-Los Angeles, Shannon Eusey wrote a business plan for a company she wanted to start.
“I got a B on the paper; the professor didn’t think it would work,” recalled Eusey. “I still have the paper in my desk.”
The professor clearly missed the mark, because 15 years and $9 billion in assets under management later, Eusey has made a success of Beacon Pointe Advisors, a business she co-founded with her father, Garth Flint.
Eusey, 47, was honored on May 2 as one of five winners of the Business Journal’s 23rd Annual Women in Business Awards (see profiles of the other winners, pages 1, 6, 9 and 11).
“I was totally stunned” to win the award, Eusey said afterward. “Looking at the incredible women in the room and the businesses they have built, I was deeply honored.”
Weaned on Business
Her father, a former naval aviator who flew in Vietnam, has a deep background in financial services, including as a founder of the Kidder Peabody West Coast Institutional Consulting Services and as an investment consultant for Merrill Lynch.
“I grew up around the dinner table where my father discussed how much he loved this business and he loved helping clients,” she said.
Eusey attended the University of California-Irvine, where she played Division I volleyball and earned a degree in social sciences and a minor in business management. She then worked as a senior managing director at Roxbury Capital Management LLC, which was based in Los Angeles. She didn’t agree with its large market cap-focused investment style and thought instead of a “better, more holistic way to help clients.”
Their Own Way
She completed her MBA, and then she and her father decided to start their business. Flint left one he’d founded, Canterbury Consulting in Newport Beach, a registered investment adviser that now has $16.4 billion in assets. Eusey and he invested more than $1 million, including hiring a consultant to come up with a name. They chose Beacon Pointe, not for a geographical site, but because it symbolized providing clients with “the clear direction” to prosperity.
They had eight employees before they even had clients. “In hindsight, we looked stupid because we just had no revenue,” she said. “Eight employees is a lot for a company with no clients.”
Eusey, chief executive of the firm, was confident it would succeed in the long run, though, because “we had something special with the model.”
The firm isn’t a broker-dealer and doesn’t push its own investment products, unlike Wall Street firms. Unlike other wealth managers, Beacon Pointe is independent, works with both private and institutional clients, has its own proprietary research team, and acts as fiduciaries for clients. The 2008 financial crisis was its most challenging time, because “everyone thought the world was coming to an end, especially in the financial market.”
The firm’s survival is a testament to its strategy.
“A difficult market is really where you make your money,” she said. “If you can minimize volatility, you’re able to compound wealth at a much higher rate.”
An indication of its conservative outlook is its relatively high allocation of cash, 30%, of the $127 million in the firm’s only two mutual funds. The Port Street funds, named after the neighborhood Eusey grew up in Newport Beach, returned 7.72% and 5.85% last year. She said the firm offers a variety of other strategies to clients who want higher returns.
About $2.5 billion of the firm’s $9 billion in assets under management is from acquisitions.
Today, the firm has more than 100 employees in places like Arizona and Philadelphia. It has picked up awards along the way, including Forbes 100 Fastest Growing RIAs and Barron’s Top 100 Women Financial Advisors.
She Has It All
Eusey identified with the awards luncheon keynote speech by Markall Inc. Chief Executive Robin Follman-Otta about a woman trying to do it all.
Her husband, Rick, is a stay-at-home dad, and they have four children ranging in age from 10 to 17. In her spare time, she teaches a class once a year at UCI on wealth management. She also enjoys running marathons, including Boston, New York and Berlin in recent years.
She said, “You can have it all if you prioritize and you’re passionate about what you’re doing.”
