After the hasty exit of Bill Miller in 2016, the $22B TAMP incubated Jeff Raupp as chief investment officer instead of seeking a ringer.

September 11, 2018 — 12:00 AM UTC by Oisin Breen


Brooke's Note: The whole idea behind a TAMP is to take an IBD rep and effectively convert them to an RIA by having their portfolios outsourced to a fee-based manager. But Brinker Capital is converting from that classic model to one where it becomes a TAMP for RIAs themselves. To do so, it had to tweak its model and give RIAs more control than a TAMP is likely to cede. But that made its CIO role tricky to define and fill and indeed, the company pretty much punted on not having a named CIO for two years. Now Jeff Raupp has the job -- with some restrictions on his power.

After two years redefining the role and reshaping the business, Jeff Raup finally can breathe a sigh of relief after he was formally appointed as Brinker Capital Inc.'s new chief investment officer (CIO) as the firm continues its metamorphosis from old-line TAMP for brokers to a help-U-invest model for RIAs. See: AssetMark records 'off the charts' year and SEI is 'right on track' after staggering $1-billion platform overhaul.

Scott MacKillop
Scott MacKillop: It looks like Raupp ran the gauntlet and passed with flying colors.

Raupp took the coveted position at the Berwyn, Pa.-based TAMP on June 7, although the reason comes with a twist in the tail. See: As Brinker Capital embraces RIA future, it ends two-year period of being an outsourced CIO with no named CIO

His appointment was not made so that he could exercise big top-down mastery over Brinker's $22-billion pile of assets, but as a reward for tackling inefficient processes and communication issues that were rife at the firm.

"It sounds like Raupp had the kind of challenging situation that could have developed over the years as Brinker grew quickly, entered new markets, and developed products and lines of business," says Scott MacKillop, CEO of Denver, Colo.-based First Ascent Asset Management, via email. Scott MacKillop applies shock-and-awe pricing to SMA market to good effect after merely lower fees left RIAs flat.

"Sorting that all out successfully would require serious leadership skills ... It would also call for a fair amount of patience and diplomacy."

Raupp fills a position that has been vacant since Bill Miller's immediate departure in April 2016. Since then, he proved willing to accept the touchy-feely dictates of doing business with RIAs who want a say in the process, while bringing a degree of coherence to its disparate fiefdoms.

"When you have this changing environment, it's not just about delivering outstanding investments, but in the right vehicles with the right communication in place. That's where we were really putting a focus on," he says. 

The decision to forego a CIO in a firm that is, itself, an outsourced CIO is notable in many respects, says MacKillop.

"It's somewhat unusual for a firm like Brinker to leave the CIO role formally unfilled for two years ... but both Jeff and Brinker may have wanted to see how that leadership role fit before formally appointing him."

Key to advancement

Bill Miller
Bill Miller was was appointed Brinker's chief investment officer in 2008. He resigned with immediate effect in 2016. Since January 2017, he has been a partner and investment specialist for Washington D.C. retirement and consultancy firm (k)RPG.

Raupp's association with Brinker is a long one, stretching back to 1996 when he joined the firm as operations manager. He moved to the investment-side in 2001, supervising its mutual-fund program.

Ostensibly, his promotion is part of a growth-focused hiring spree that began in January with a number of executive appointments, including a new head of quantitative strategy, David Hall, and a new digital marketing director, Jason Brown. But Raupp's role in changing Brinker's corporate culture was key to his advancement. 

"Brinker could have attracted many people to the CIO job, but they've had plenty of opportunity to 'road-test' Jeff and it looks like, ultimately, they liked the outcome he achieved and the qualities that he displayed in doing it," says MacKillop.

"The fact that Jeff was able to earn the CIO title after two years suggests he did an excellent job solving the problems he identified,"  he adds. 

As chief investment officer, he will oversee asset management and strategy, portfolio construction, the mutual-fund program and chair Brinker's investment, asset allocation and executive committees.

It's a full plate, but the firm is in a much better position than it was two years ago, says Raupp.

Ultimately, this is a feel-good story, and kudos are due, says MacKillop.

"They gave him the chance to prove himself, and he delivered. It's a nice outcome, given the fast-paced, cutthroat way things are often done."

To-do list

Brinker made a concerted move into the RIA space beginning in 2013, with the roll-out of Brinker Investment Services. More recently, in Dec. 2017, it launched Brinker Capital RIA Services, which includes a modern, open-architecture model manager, strategy and portfolio marketplace. 

During the restructuring, Raupp initially shared responsibilities with senior vice president Chris Hart. But he took over full control of the CIO's duties eighteen months ago, following a promotion to director of investments.

In that role, Raupp's to-do list included one very RIA-minded objective -- act as midwife for Brinker's move from the more tactical short-term focus attributed to his predecessor, Miller, to the kind of longer-term strategic thinking demanded by RIAs. 

"I really wanted to make sure, when we look at the time horizon for investment decisions, that you're always looking at least six months to years ahead," Raupp explains. "With Bill we'd try to react a little bit more on a short-term timeline."

The checklist also included two other big changes: Outside investments were allowed in portfolios, and RIAs were given a say in investment decisions.

Raupp also redefined how Brinker allocates assets and manages portfolios; increased the services available for high-net-worth clients and brought the firm's third-party Destinations mutual funds in-house.

"If you look at how we've unified the [investment] processes and philosophy ... we're just a much more efficient and effective group today than we were before," Raupp says.

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