What BrokerLink looks for in an M&A deal

BrokerLink looks at best practices when making an acquisition, recognizing that each deal is unique and doesn’t follow a boiler template, says the brokerage’s president, Joe D’Annunzio.

“One of the things for us is we look at best practices,” D’Annunzio says in an interview. “So sometimes we buy a brokerage who’s doing something better than us, and we need to adapt to that if it works right. We’ve had some brokerages where we change the brand after six months and some brokerages that have been there for four generations and 120 years [and] we waited three years.”

Does BrokerLink look to acquire a brokerage’s technology, or does it insert or inject its own?

“We’re focused particularly on the digitization of the customer journey… and that’s fuelled by data analytics, and some cross-functional collaboration in the background,” says Michael Stack, BrokerLink’s vice president of acquisitions.

“We’re certainly interested in acquiring brokers that have unique technical advancements or offerings that we can integrate with into our organization and continue to enhance the experience for our clients,” Stack says. “On the other side of the spectrum, for those who haven’t invested heavily within technology and how to digitize their customer journey or experience as of yet, we’re able to inject some technology, digitization into those brokerages and expand the offering to their customers, thus enhancing that customer experience and helping them to provide that second-to-none experience.”

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It’s important to meet consumers where they want to do business, adds D’Annunzio. “Going forward, those who have multiple ways to reach the customer are going to be very important in the future. We want to be a leader in that space.”

The omnichannel experience allows clients to walk into a physical location, make a phone call with their personal advisor or another broker, or interact digitally. “The customer gets to choose how they want to interact with us, not how we want to interact with them,” D’Annunzio says.

He adds BrokerLink represents more than 100 markets, which can be attractive for some brokerages looking to sell, particularly if they are smaller with only three or four markets, for example.

When it comes to succession planning, D’Annunzio recognizes there can be anxiety about what happens next. “I’ve been on the other side, where I’ve been acquired as an employee,” he says. “For us, communication is absolutely at the forefront.”

As soon as an acquisition is announced to the employees, BrokerLink does a presentation for them and shares BrokerLink’s values: integrity, respect, customer-driven, generosity, and excellence. “We have 200 locations, but we have tried to build a culture which is diverse, inclusive.

“One of the things we’re quite proud of is our purpose. We start talking about that right from the beginning so they have something to attach to, besides the five values,” D’Annunzio says. “Our purpose is, we’re here to help people. We believe that insurance is about people and not things. As you start introducing those things, there’s something that a small community or an office can gather around.”

Although a brokerage’s ownership may change, brokers are still dealing with the same customers. “We don’t change the brand,” D’Annunzio says. “We don’t change their system. We don’t change anything for the first three, four months. Slowly, we start moving them to our platform, introducing them to our markets, our way of doing things.”

Stack says a lot of time is spent to ensure a smooth transition, and combining BrokerLink’s culture with the culture that exists within the acquired brokerage. “It’s something we do well; it’s something you have to get right.

“It’s making sure that employees are comfortable,” D’Annunzio adds. “If you’re a firm that is not paying a lot of attention and developing your people and giving them opportunities to grow in their careers, you’re going to lose the good talent.”

Feature image by iStock.com/PeopleImages