How an advisor turned the ‘dumbest idea ever’ into a $780M RIA

When John Evangelista became a financial advisor 31 years ago, one of his first orders of business was to apply his newfound knowledge to his mother’s finances and investments.

Processing Content

Evangelista assumed that his mother, who’d spend some  20 years as a nurse at the University of Michigan, an institution with generous retirement fund matches, would be in great financial shape. Instead, he found that without guidance from a financial professional, her investments had been extremely conservative.

“I was like, ‘Why are you doing that?'” said Evangelista, who is now CEO of Evangelista & Associates in Ann Arbor, Michigan. “When she started, she sat down in orientation, they gave her a bunch of information, and they said, ‘go choose.’ She didn’t know what she didn’t know, so she went to one of her peers, a senior nurse in her 60s. My mom thought. ‘I respect my superior, I trust her,’ and so she followed the advice.”

“The advice that she got was appropriate for the older nurse, not for my mom,” Evangelista said. “That’s still happening today. It’s literally happening today.” 

READ MORE: When should a financial advisor launch an RIA?

Around the same time, Evangelista was reading Peter Montoya’s “The Brand Called You.” When he attended one of the author’s seminars, Montoya asked the question, “What do you do, and who do you do it for?” 

That got Evangelista considering who he would want to help if he were to build a niche, and he thought about his mother and other university employees who could use financial guidance. 

“I flew back, and I was all excited. I came to my principal and I said, ‘I’ve got this idea. Let’s just create this niche underneath your umbrella,'” Evangelista said. “I smile about this today. He said, ‘That’s the dumbest idea ever. That will never work.’ So here we are now, on our way to a billion AUM.”

Evangelista, whose firm now boasts nine advisors, nearly 700 families and $780 million in assets under management, sat down with Financial Planning to discuss how he developed and built his niche with university employees, as well as the challenges he’s met and the advice he would give others considering a niche. Read more of the Know Your Niche stories here.

This conversation has been lightly edited for length and clarity.

Financial Planning: Tell me about your start. Who were your first university clients, and how did you start those relationships?

John Evangelista: Back when we used to have a phone book that we could tear pages out of — that’s a true story — my first faculty client, an art professor, was a cold call out of the white pages of the phone book. 

FP: It sounds like you literally started with the letter A in a book and moved on. Was no one from the anthropology department interested?

JE: No, but in the early days it was quite common for a lot of us as advisors to have clients with the last name starting with the same letter, and now you know why!

I realized there are professors in the [university’s] School of Art & Design, music, theater, dance — a lot of these more creative English and literature people — who are passionate about literature or art and totally not financial people. They had the greatest need and the greatest openness to someone like me. That’s how it really started.

READ MORE: How patience, trust and free advice built a $125M advisory niche

FP: In serving a university, you have both faculty and staff. Is there a difference between their needs and how they’re served?

JE: It’s a beautiful mix. I would say that faculty is definitely different, having to know about sabbaticals and scheduling sabbaticals, how they’re going to finance that and where they’re going to go. Are they going to rent their house when they’re out of town? 

We have a core philosophy that hasn’t changed. Whether you have five $5,000 or $5 million, we treat everybody the same. We have a very successful, well-regarded medical school and research complex with U of M, but we have clients that are janitors, we have clients that are in facilities. We have clients that are all across the whole university, and I’m very prideful of that. The advice that’s needed — some of it’s common that won’t surprise you in any way — but, yeah, it’s different for each group you mentioned.

FP: How did it grow from there? I would imagine referrals are a big part of the business.

JE: Yeah, we are by introduction only. We are by referral at this point. We don’t do any public marketing. 

The only way anybody finds us now is through the advocacy that we’ve created and generated within our clients, because we know what they don’t know. We know their benefits better than they do, and I think that’s a key difference. 

In my experience, we’re not usually somebody’s first advisor. We’re usually replacing someone. We ask our clients, “What made this different?” The common thread is, “You didn’t just talk about investments. You helped me figure out my beneficiary designation, you helped me with my open enrollment items because we don’t have orientation anymore.” Our clients are our centers of influence. 

FP: I could imagine that serving such a diverse set of clients even within the university niche could be difficult, though. A provost is making significantly more money than an assistant professor or a janitor. Does that influence who you serve?

JE: We’ve never set a firm minimum. I know a lot of firms have. But I’m an Ann Arbor kid.

Most advisors that you meet might count the relationship length of a client because they need money that they can manage. They need money and movement. They need that person to leave a university community in order to work with them and to monetize them, or to generate fees. We will count our client relationships in 50 years, 60 years, and not just the last 20. We have purposely chosen to be that firm that will help a 22-year-old nurse — what I wish had existed for my mom. 

My mom should have retired as a multimillionaire. U of M has a 2-for-1 match. Just by virtue of the dollars going in invested appropriately, everybody should retire as multimillionaires, regardless of whether you’re the provost or whether you’re an assistant or associate professor. We are just as proud and happy to meet with a brand-new, 22-year-old nurse to get her set up the right way, because with the amount of time that she’s going to be at U of M and then in retirement, I hope we count those relationships in multiple decades.

READ MORE: The $500M RIA that took off by microtargeting clients

FP: A lot of faculty members move from university to university. Do you wind up serving clients who have moved? And do they refer new colleagues at their universities to you?

JE: The short answer is yes, because of the fact that they realize in those other academic communities, the same condition is present that I talked about earlier — no one’s helping them with this stuff, no one’s bringing up open enrollment, no one’s helping maximize benefit plans. 

I love when they ask, “Can I continue to use you?” The answer is obviously yes. Once they get in there, they all talk. I love the fact that they usually will start referring. That’s why we’ve had numerous clients at Vanderbilt [University], and now we’re growing a larger presence there.

FP: What advice would you have for someone who’s trying to identify their own niche and grow a client base there?

JE: One, where do you find the greatest reward? Who are the people that you want to help? It doesn’t feel like work. Coming to work is to generally know that I’m making a difference. Some of these people are saving babies. I see one of my doctors on “Good Morning America,” and I realized that this lowly Ann Arbor kid is managing his finances, and he’s literally saving babies and changing the world. Find that thing. The whole idea of a niche is to find something that speaks to you.

The practical side is, is your group large enough to support the business? I could have Ferrari-driving, ponytail-wearing cardiothoracic surgeons. How many are you going to find so you can support the niche?