The Secret of Success: Local Agency Autonomy
When I meet with insurance agency owners about investing in their businesses, one of the most frequent and important concerns they have is about losing control of their operations.
It’s a natural concern. When you spend so much of your life building a thriving insurance business, you don’t want to have your entire company pulled away and changed overnight.
These entrepreneurs are relieved and surprised when I tell them that our approach is to purchase an interest in their business and make sure that they keep full autonomy and operational control of their agency.
Unique Business Model
I say they’re relieved because they learn that we have a unique business model that values successful local agencies maintaining their local identities, cultures and processes so they continue to grow in their local communities, without disruption to their clients or employees. We want to them to continue to do everything that has made them successful.
The agency owners are also surprised because they know that other companies in the industry typically buy 100 percent of the agency and centralize everything in the corporate realm. That means the local agency gives up all control, adopting the parent brand, corporate culture and business processes.
This happens because these companies are mainly public companies or private equity firms focused on building their corporate brands and scale to impress shareholders and investors.
We take a different approach—we seek partners who want to stay invested in their agencies, and who want to be owners with us. We want our partners to be those agency leaders who aren’t done yet—who aren’t done working and leading and growing. That’s why our co-ownership model works so well.
We take the long-term view because that’s the perspective of our majority investor, the Ontario Teachers Pension Fund, the largest single profession pension fund in North America with over $180 billion under management. Unlike public companies and private equity firms, the Pension Plan has a unique, long-term investment horizon.
With this long-term perspective in mind, we selectively seek out growing, successful agencies—we’ve added only 17 core partner agencies during our 15 years in business—and work with them to continue their growth.
At BroadStreet℠, we help our partners grow organically and through acquisition by providing access to capital and professional acquisition expertise. In fact, to date our core partners have added more than 200 agencies through acquisition.
Guided by Principle
To maintain transparency with our partners, we are guided by certain principles, which define how we behave as a business, how we treat our partners and the characteristics of the BroadStreet℠ system. You can read more about the BroadStreet℠ approach and our guiding principles.
Our support for local independence is based on our belief that the key to continued success for our partners is to continue what has made them successful:
- Building strong leadership teams and cultures
Successful agencies develop strong leaders and cultures that focus on fully serving clients needs, while ensuring employee growth and personal development. Imposing a corporate culture on a local agency destroys morale and disrupts client services.
- Understanding their clients and their needs
No one knows the needs of agency clients better than engaged local agents and staff. A corporate client relationship management (CRM) tool should never replace the intimate knowledge and regular contact of an effective local staff.
- Developing trusted community relationships
Successful agencies live in and love their communities. They develop trusted relationships by investing time and resources in making their towns better places to live. These relationships can never be outdone by large company marketing campaigns. The local, personal touch of people is what makes a difference.
These and many other factors drive the success of local business and this why we at BroadStreet Partners℠ will continue to stay on the path of autonomy for our local, independent partner agencies.
Please contact us for more information about our unique business model and approach.