What if you don’t have to sell?
In an insurance landscape rife with mergers and acquisitions, mid-sized independent brokerages are the main target of big conglomerates, and many feel pressured to sell. Ben McDonald says there is another way to do business on your own terms.
“By the time someone reaches out, they know there’s a problem, they just don’t know how to solve it,” says Ben McDonald, CEO of Insurance Growth Network (IGN), a company purpose-built to support brokerages and producers who want to carve their own path in an increasingly competitive, high-barrier environment.
To him, the insurance industry has always been a creative, innovative, relationship-driven space, so it irks him that the dominant thinking today seems to be that the only viable way for many mid-market brokerages to grow is to be bought out or merged into a bigger entity. Nowhere was this more obvious to him than during the pandemic.
“A pile of sales occurred during COVID, and some shocking ones,” says McDonald, explaining that many news headlines left him thinking, why did they sell? “That was a turning point,” he says. “It was like there was no other option now but to sell, whereas before there used to be options. The time was right for us.”
The thing is, he knew what those options were, but it seemed no one else could see them. To McDonald’s mind, brokerages facing the M&A hammer need one thing: support to grow their business organically from within. Designing and providing that support is the sole focus of IGN and it’s not only changing the landscape of insurance in Canada, it’s giving many producers and brokers a new lease on independence and prosperity.
Ben McDonald, CEO of IGN
Walking the talk
McDonald is a third-generation insurance man who worked his way up through the family business, from making cold calls to heading up new business development.
By 2020, as president of CMB Insurance Brokers, McDonald and his team had long been walking the talk of organic growth, taking their own company from one Edmonton office in 2013 with a handful of staff, to a multi-office firm with well over 150 highly engaged employees.
They did it by helping individual producers launch their own independent brokerages under the CMB banner with aggressive yet achievable growth targets. They also helped existing brokerages stave off the M&A threat with customized plans for rapid, sustainable organic growth. By this time, CMB was also partnering with commercial enterprises looking to add insurance to their portfolios.
It was a journey that started, well, organically. “I met a producer in Grande Prairie who wanted to go out on his own, and we supported that,” says McDonald. “And I met two more after that with similar ambitions, and I thought, do we have something to sell here? And can we do it at scale? What happens if we create a branch that focuses on organic growth?” A lot, as it turns out. And in 2023, CMB formalized this branch of their work by creating the IGN brand.
Making space for middle market brokers
So, what, exactly, does IGN do to help independent brokerages stay independent? McDonald says that the growth plan for each producer or brokerage is different, depending on the specific needs of that business. But three things remain the same for all: aim high, be accountable, invest in the right people.
While that may sound simplistic, these maxims are at the core of what IGN does when working with clients looking for help in maintaining their independence.
“We have three customer types,” says McDonald. “Producers who often don’t feel supported by their employer; brokers who know they’re capable of doing more but can’t see the way; and partners who want to supplement their core business with insurance but don’t know how to go about it.”
“We have three customer types,” says McDonald. “Producers who often don’t feel supported by their employer; brokers who know they’re capable of doing more but can’t see the way; and partners who want to supplement their core business with insurance but don’t know how to go about it.”
For each, IGN builds individualized plans that provide supports, skills and strategies that foster organic growth. For example, IGN provides centralized admin support to brokerages because, as McDonald puts it, why burden a top producer with the task of finding and hiring top talent or managing payroll when their time is better spent writing new policies?
There’s much more to it, of course, including client and revenue targets, marketing support, access to capital, new technology adoption and more. “We’ve figured out a formula built on experience and hard graft,” he says. And it works. For producers or brokerage owners serious about maintaining independence, McDonald says IGN will provide viable options to do so.
People drive profit
McDonald is uncompromising when it comes to the core values IGN is built on, and that inform its organic growth platform. Interestingly, in a world full of faceless mergers, people are at the core because, in his experience, people are the secret weapon for success.
Indeed, IGN’s five core values are all rather person-centric: Do what you say. Be humbly confident. Happy to help. Do the right thing. Improve or we die. That last one is an eyebrow-raiser, but McDonald sums it up neatly: “Dying, to me, is that we have failed and have to sell.”
IGN’s approach to organic growth is underpinned with making investments in people who can make a brokerage stand out, be unique and be undeniable when it comes to delivering service and products to customers. Think about it. If you’ve got a broker who has taken the time to understand your needs and the risks you face and then come up with customized solutions, are you really going to shop around for different quotes?
“Big brokers can get away with the standard operating playbook of moving people around like pieces on a chessboard,” says McDonald. “And the big conglomerates – their best people are focused on the next acquisition. They don’t care about the people and the brokerage. But relationships still matter in this business.”
It’s an approach McDonald used to spur the rapid growth of CMB and is now a key part of the IGN playbook. “If I help my people be as great as they can be, they’ll do the right thing for the company and their clients,” he says. “CMB is small, and it has a growing brand, a reputation, so if we treat people like pawns no one will work with us. I can’t sell every policy, so my client is my people.”
“You need to show good people there’s a future in your organization, and in order to do that you have to be growing,” says McDonald. “The power we have in being independent is the power of choice. I can tell shareholders that if we continue to invest in people, they’re going to be rewarded.”
McDonald explains how, at the beginning of CMB’s growth path, taking an honest look at working relationships was a key step in their path forward. “We benchmarked on the people we loved in our organization and why we loved working with them,” he says. “We also benchmarked on the people we didn’t like working with so much and why. We developed our core values from that.”
Those values apply to all, from entry-level employee to CEO – McDonald himself. “We all need better ways to communicate up and down the line,” he says. “We want to build a strong fabric with our people. I believe in hiring from within and taking the time to develop people, and we do that through mentorship.”
But to develop people, he says, you first need to develop the company. “You need to show good people there’s a future in your organization, and in order to do that you have to be growing,” says McDonald. “The power we have in being independent is the power of choice. I can tell shareholders that if we continue to invest in people, they’re going to be rewarded.”
Are you ready?
Passion is an overused word, but it’s hard to describe McDonald as anything other than passionate about the possibilities that exist for middle market insurance brokers who have fire in the belly.
IGN even has a Passion Statement that forms part of its core values: “Build a great company by investing in great people who, in turn, accomplish remarkable things.” It’s as much a promise as anything.
“Coming out of university, you’re exhilarated, you want to change the world, make a dent, and that never really changed for me,” says McDonald. “That’s where the ‘build a great company’ comes from – I want people who engage with us to say, ‘that was the best’.”
IGN does that, he says, by helping brokers and producers succeed on their own terms and in spectacularly big ways by working with them to see the bigger picture, to see what’s possible and to realize what they are capable of as individuals and small companies.
You don’t have to follow the M&A playbook if you don’t want to, says McDonald. With its focus on people, process, proven systems and clear benchmarks, IGN has a different playbook that will net greater success if you’re willing to put in the work and be accountable all along the way.
“I want to be the one who people phone,” he says. “I want to define this category for independent brokers. I know there are answers if you’re willing to put in the hard work. There is hope; there is a solution.”
For information on how to leverage IGN’s history of success for your brokerage’s future, contact us today!