John Pelle, Senior Director of Communications & Brand at Acrisure, welcomes you to Season 2 and, in this first episode, has an insightful conversation with Sozon “Soz” Vatikiotis, Chief Operating Officer at Acrisure.
Soz tackles Acrisure’s intentional history of bold actions and current transformation with candor and transparency. He also explores how leaders can approach transformation in a way that engages their teams along the way.
“As soon as I think I’ve seen it all, I get surprised and we’re going to go do bigger, bolder and more innovative things.” — Sozon Vatikiotis
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Further Reading:
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TRANSCRIPT BELOW
JOHN PELLE:
Well, welcome back to the Limitless Possibilities Podcast presented by Acrisure. I'm your host, John Pelle. I could not be more excited to welcome you all to season two, episode one, featuring a returning guest, Chief Operating Officer Sozon Vatikiotis. Soz, welcome back to the program.
SOZON VATIKIOTIS:
Thanks, John. Appreciate you having me. And I wasn't sure after our first little banter if I would ever be invited back, so my guess is maybe the content was good enough. But here we are, so happy to be back and spending time with you.
JOHN PELLE:
Yeah. So I guess the first thing we have to hit on is, again, these won't be the Acrisure podcast, but I think we have to address the big news that we had just announced. So our intent to unify the brand, our intent to form regions and specialty platforms going forward, all in an effort to really crystallize and cement our status as a Fintech company. So as someone who's driving that, leading that effort, leading the operations of all this work, Soz, I'd love for just you to have the opportunity now to contextualize it. Whether you're a partner, whether you are a client, whether you're just somebody who's been following our story, maybe give a little bit more background behind the scenes on our announcement.
SOZON VATIKIOTIS:
Yeah, absolutely. So I think just some contextual, foundation level setting would be good here. We've created an unbelievable business. Greg, day one, minute one, dollar one to this point. It's been not a long time. I mean, really 2013 was probably 35 plus million in revenue. And the time where we became a real business to now, 10 years later, 4 billion plus in revenue and not slowing down. And I think what's really important to hammer home and make sure everybody understands and is sometimes lost is the intentionality of this business. And everything that's been done all the way back to the very first day was done with tremendous amount of thought, strategic calculation and intentionality. And it's what got us to this point. So when you go back to the day that Greg and Rick founded Acrisure, they, Greg saw an opportunity to differentiate a DNA and a culture of a business where the vast majority of the competitors or the businesses that were in insurance aggregation were pretty stodgy, pretty rigid, not necessarily entirely conducive to an entrepreneurial environment.
And so he created a very vibrant, entrepreneur-centric model of autonomy, DNA, partner centricity, and that resonated. And so that's what started, and it was very intentional. And you fast-forward to 2016, and we had a management buyout that put us on a path to owning the business, controlling the business. And I say us, I mean management and the employees that drive the revenue of the profits every day. And so it positioned us outside of the private equity sort of hamster wheel and cyclicality, and allowed us to take a very long view of the world and go do some pretty cool things with the business long-term. You get to 2018, and we brought on Beach & Associates, now Acrisure Re, it's our big reinsurance brokering company based in London. And that began the real underpinning of our value chain compression strategy, which is essentially taking all the scale that we built within the business and using intermediary expertise to maximize how we place and manage that risk for our clients, as well as creating a more economically advantageous outcome for us.
You get to 2020. And we brought on Tulco (AI and data capabilities) which now underpins our Fintech model to here we are in 2022 talking about transformation. And so long-winded intro, but the point here is everything that we've done up until this point with this business has been extremely calculated, intentional to positioning us. And so we've spent a long time building scale in the organization and we've amassed through a very proprietary M&A and new client acquisition model, powered now by data and AI, to create one of the largest SME client bases in the world. And now we've got the opportunity to really synergize that business through a common brand and through a different, more controlled organizational structure that places more of the business into the hands of our best entrepreneurial leaders. And so we've got all this really cool vibrant things happening in the organization from significant data-driven branding efforts to naming rights on stadiums, the Steelers and Acrisure Arena out in Palm Springs, to significant support in the communities and a $15 million charitable contribution to a children's hospital here in Grand Rapids.
I mean, there's a lot that we're now doing to build a very common brand. And so shame on us if we don't take advantage of that and bring more of our business - instead of having it spread out over a thousand bespoke brands, we now bring it under a pretty powerful one where we're doing great things and transforming the business to take advantage of a lot of that cool stuff. So a long-winded answer, but we were very intentional around doing things that would allow us to create significant scale, which has been the first chapter of the lifecycle. And now that we're here, we want to try to do some really cool and advantageous things with the business and with the scale. And that revolves around single player brand and transformation and bringing more of that business into a platform structure and placing it in the hands of our best and brightest entrepreneurial leaders.
JOHN PELLE:
Thanks, Soz, and there's a couple things in there that I want to unpack, but I've been here a couple years, obviously last season we talked about your journey as a partner, as a practice leader, COO, ushering us into this Fintech future. One thing that Acrisure has never been and probably won't ever be is shy, so I'll just go ahead and ask the question just so we ask it once. What would you say, Soz, to somebody who said, "Well, I never thought Acrisure would do something like the intent to unify the brand and the intent to operate differently." I know you said everything's been calculated, but just to address the fact that this is such a massive and intentional change for us. As somebody who's been in multiple roles with the company, what would be your last word as far as this is the decision that not just the leadership of this company made, but really the partners of this company made as well?
SOZON VATIKIOTIS:
Yeah, I mean, look, I think I learned a long time ago never say never. And change in an organization like ours is always constant. And I don't mean constant in the sense of every few years we change. I mean, for us it's quite literally every few weeks in some cases that we change. Which, on the one hand can make honing in on a particular direction a little bit more challenging at times. But on the other hand, it's just a constant vibrancy and energy in a business that is always looking for ways to improve. And so I would say that you could go back to, I mean, I've been here eight years, so a vast majority of the growth. And I think the difference here today is we essentially created this position in the company through a strong, consistent partnership between our leaders in the field and our agency partners and Greg driving a strategic vision and direction that's been validated by the investor community that says you created something that's incredible today, but could be once in a generation tomorrow if we did a few things.
And so I think as we sit here today, we're not rebranding for the sake of rebranding. I think some of the things that you've hit on, John, and I did earlier is we're doing some really incredible things that create a lot of energy and excitement around a brand, for example, that shame on us if we don't take advantage of. And as we sit here, and in particular, kudos to Grahame Millwater and a lot of the field team that have spent hours and hours engaging our partners, we're hearing from our partners that this is something that makes sense, that they want to be a part of, that we're having real impact on the business through branding efforts that people want to take advantage of.
And so it'd be very different, John, if we were to just simply say we're going to brand Acrisure. No awareness around the brand, we're not doing anything in the community to support the communities that support us. We're not doing cool things like naming rights. We're not actually building a vibrant brand. It'd be one thing if we were to say, "Look, we're just going to start slapping Acrisure on your offices." That won't work. But when we're working with our partners collectively to drive towards a incredibly differentiated direction and outcome, and we've done some really cool validating things with the brand, people want to be a part of that. And so I think that's different. If you were to go back to the days when we said, "We'll never brand," we weren't having the conversations that we're having today. We weren't having the data-driven impact that we're having today. We weren't having our name on NFL stadiums like we do today. And so it's just a different world.
And I think that's the one thing that I've learned to get very, very comfortable with is the fact that as soon as I think that I've seen it all, or as soon as I think that this is it, I get surprised and we're going to go do bigger and bolder and more innovative things. And so as long as we maintain the connectivity with our partners and make sure that we're collectively driving to the outcomes that we think are possible together, and we maintain that culture, we maintain that entrepreneurial DNA, and we just continue to challenge ourselves to do things that others frankly would never dream of in 10 lifetimes and yet we're doing it in a decade. So it's pretty cool. And I think the one message that I would say constantly, and Greg says it, is frankly, be comfortable with change. Get comfortable being uncomfortable. And the second we find ourselves embracing that mentality, there really is no telling where we could take this company.
JOHN PELLE:
And you hit on a point that I think we'll come back to. So, for those listening, I think season one we really dove into let's get to know some of the people in leadership roles at Acrisure that have contributed to the success and defining the path that Soz had just described. I think for season two, the opportunity is to, in that same vein of taking things to new heights, through our people, we have, I think, really incredible connections into a variety of really interesting industries.
One thing that I think we will ask all of those guests, and I'll start with you, Soz, is how do you transform in a way that disrupts what needs to be disrupted? Because you wouldn't transform if there was nothing that needed to be transformed. So you take that as true, but how do you do that in a way that doesn't transform the things that you want to be static and constant as part of your DNA, both at Acrisure, but really just in your experience like running businesses and as a COO today, what would you say is your advice or your philosophy on transformation?
SOZON VATIKIOTIS:
Yeah, I mean, look, I think it's a good point and it's one that it's easy to gloss over, but the idea that we've created a phenomenally prolific company today. If we did nothing else, we'd have great business. We already do have a great business. We've clearly been validated with the 13 billion plus in outside capital that's been invested in the business at market leading valuations. I mean, we've done something already that's astounding. So there's no crisis here. There's nothing that we can point to and say, "Hey, we better go do this, or else." And so getting people bought into the idea of, hey, we're going to transform this business, recognizing that there's no real need to, we're already great, that's a little bit of a challenge. When you talk to people inside and outside the company, they're like, "Really? You really want to do this? Isn't that kind of risky?" But we're so devoutly committed to this idea that repositioning and transforming the business into a Fintech company will take us to levels that are sustainably and perpetually opportunistic.
When we essentially position ourselves with a broader mindset to say, "Yes, 90% of our business, revenue is generated from insurance today, but what could it be when we start talking about cyber and IT services and mortgage origination and potentially payroll and the next, the next, the next," and you have an ownership structure in place that gives us the flexibility to have a view of the world that's not two years from now, but 20 years from now and 30 years from now, you have to take advantage of these opportunities. You can't wait for crises or else you're too late at that point.
So really the greatest companies, if you really ever studied them, they're constantly evolving and they're constantly transforming. And this is where Greg is just so spectacular. He's thinking three and five years ahead always. And that's tough to do when you're riding a wave of success that intuitively would tell you don't change it. It's working so well. But with where we are in the world today, and you've got influences that are growing like generative AI and ChatGPT, the next 10 years for companies like ours will be extremely disruptive. And so if we're not thinking about getting ahead of that today, it will pass us by. And the companies that I read about today that are not embracing, just using the example of generative AI, I don't even understand that. There will be companies that go out of business.
And so I don't know if people know this, but if you go back to the Fortune 500 companies that existed in the fifties, like 88% of them are no longer Fortune 500 companies. And a core theme is they didn't evolve, they didn't transform. And when you evolve and transform, you don't do it when you've got a problem. You do it when intuitively it wouldn't make sense to, when you see opportunities. So that's where we are. Doesn't make it easy though. And so your question around how do you do it, I think to try to simplify the concept into a couple digestible concepts, it's really connectivity is a key theme that we have to constantly have a pulse on, and then awareness and transparency.
And so we can't find ourselves in a position where you've got a small group of the organization called the executive team, for example, that's the group that's driving and very aware and very connected to the direction and the investor perspective, and yet we're the only ones that know. We'll fail, we won't get people to buy in. There will be a massive chasm between the boldness and the innovative direction we want to take this company in and the desk level employees that don't have any exposure to it. So you've got to have the right connectivity with all the key stakeholders. And then there's got to be awareness and education and engagement that's constant. People, particularly ones that find themselves in a position where they're being asked to drastically change how they do things in an environment where it's working really well, you're not going to get them to buy in unless they really understand what we're doing, what it means to them, and why it's important to the client, to them, to the organization, et cetera.
And so that's the challenge. It sounds really simple. These are two kind of very elementary concepts, connectivity and awareness and education. But the actual act of understanding who all of the stakeholders are and understanding how we need to communicate and engage them and do it in a way where it's going to resonate. And not just say, "Okay, I get it," but say, "I get it," and be extremely excited about that, that's an entire culture. That's an entire DNA of a business. And so I don't want to sit here and say it's simple, John. You just got to connect with people and tell them what's happening. No, no, no. It's far more robust and dynamic with that. But if we get that right and when we get that right, we will be in a position where we can perpetually infuse this company with new, bold, dynamic directions and ways to differentiate itself.
And at that point, you go back to Greg repositioning the business back in '16 with a management buyout, there's no telling what this company looks like 20 and 30 years from now. And that's what really makes me excited about where we can go with this organization. It's a combination of the disruption that will come to businesses like ours, the fact that we're on the leading edge of it and leading it, the fact that we can do that with our ownership structure and the fact that we've got an entrepreneurial DNA in this business that allows us to get excited about these things. So long as we understand who we need to connect with, how we need to connect with them, and we make sure we've got the right connectivity and awareness around all of that, we're going to be massively successful when others simply can't.
John, I've enjoyed it. I love where we are, love where we're going as an organization. I love doing all the things that I do with the people that are in this company and our clients and our investors. And truly, I wake up every morning and sort of pinch myself, and I don't expect that to change. If nothing else, it's only going to get that more prolific. So this is awesome. I appreciate you taking the time with me.
JOHN PELLE:
Soz, I really could not have put it better myself. Again, thank you so much for taking the time to chat with us today and share these insights around Acrisure's recent announcement. For our listeners, we are going to wrap this episode up here today. As you heard, we've had a ton of great insights. We are going to pick this back up with Soz again soon as we think not just around Acrisure's transformation, but just broadly, how are businesses and companies of all shapes and sizes transforming. And who knows, maybe we get even a couple of best practices along the way. So thanks again for listening and tune back in for part two of our conversation with Soz soon.
Thanks for listening to this episode of the Limitless Possibilities Podcast. For news and updates, follow @Acrisure on all of our channels. We want to hear from you, so send us your ideas, questions, and suggestions for future episodes at Communications@acrisure.com.
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