In this episode of The Digital Broker podcast, Steve and Ryan talk directly to Reid French, CEO of Applied Systems, about CapitalG’s earth-shaking investment in Reid’s company. By listening to this episode, you will learn:
- What the deal represents, not only for Applied but for the insurance industry as a whole
- How Reid and Applied plan to leverage this investment for the benefit of the independent insurance channel
- What the practical implications of this might look like
Applied Net is an insurance superpower. In the course of eight years, it has grown from a little over 1,000 attendees in its first year to over 4,000 in 2018, its biggest turnout ever. Typically, the show highlights innovations and products in the insurance space, but this year, the light was shining on the conference producer itself. Just a few days before the show began, Applied Systems secured a nine-figure investment from CapitalG, the investment arm of Alphabet, which owns Google (3:38).
Good luck trying to figure out the precise amount of the investment, but Reid would rather you didn’t bother, as it’s beside the point anyway. “For us, the investment is more about commitment: to the company, to the channel, and to our customers.” It is certainly a big deal when Google decides to invest in you, as they tend to “search out the best company in a vertical market that they’re focused on—and they came to us,” Reid says.
But this is also, and perhaps predominantly, a vote of confidence in the independent insurance channel, and a reason for agents and brokers in that space to rejoice. (4:22) “Capital G invests in companies that have the potential to leverage Google’s technology and expertise for the benefit of the industry that they serve,” Reid explains. “One area of their interest has been insurance because they feel like some of their technology can be put to use there very effectively.”
Some might shiver at the sound of that. When a titan like Google or Amazon enters the picture, doesn’t it foretell disintermediation? Reid assures us that it’s not the case here, the whole point is to help the independent channel. (5:25) “We really believe that through this investment, and through the access that we now have to Google’s great assets, we can deliver transformative technology for the benefit of the independent agent and brokerage channel.” This point was echoed by Jesse Wedler, the principal of CapitalG: “Our investment in Applied will only do well if the independent agency channel does well,” Wedler said earlier in the week.
Reid elaborates on the practical implications of this at 7:00: “Look—I don’t know how insurance will be bought and sold a hundred years from now. But I have a pretty good idea of how it will be bought and sold over the next five to ten years. After all of their research, Alphabet determined that this channel’s gonna thrive and that their technology could have something to do with it. (9:20) Machine learning, artificial intelligence—those are very exciting areas for agents and brokers, who do lots of transactions with lots of data and very few people. Allowing the machine to take on some of that work frees up time to sell and to provide fabulous service. This can be transformational, and we look forward to putting that into reality over the coming years.”
So what can we expect to see? It’s too soon to start talking specifics, but Reid is kind enough to volunteer some teasers at 11:18. “We are strong believers in giving customers choice. For example, if they want to use an e-signature integration with [Applied] Epic today, we give them a choice of three different e-signature providers where there’s built-in integration. We have lots and lots of customers who use Exchange, Word, and Excel [all Microsoft products] as integration points to Epic—but there are other customers who are interested in Google’s products [Docs, etc.] because they tend to be designed for online collaboration.”
Another target is mobile apps—both for the insureds and for the agency’s internal teams (12:44). “We have apps in both the [Google] Play Store and [Apple’s] App Store, and that will of course continue. But Google owns the whole Android operating system—so what can we do with that? How can we leverage the operating system’s native capabilities?”
One thing that isn’t open to discussion is data security (15:10). “Let’s be super clear about this: There is absolutely no sharing of data—any of our customer data—between our company and Google, or CapitalG, or Alphabet, and they understand that. It’s a part of the agreement between our organizations: There isn’t a single data field that passes.”
As if this investment weren’t newsy enough, Applied has made an investment of its own by acquiring Dynamis, the creator of an expedient, real-time benefits renewal system that will be integrated into Epic. Reid explains the basis of this acquisition—plus he touts other releases that he’s jazzed about, including texting with customers and bulk texting. But you’ll need to jump to 16:22 to hear him talk about all those things.
Reid invites readers and listeners to find out more about all these developments by visiting the press release page of the company’s website. As for the Google deal, he is open to talking more about it in good time.
“We very much look forward to a year from now when we’re back at Applied Net 2019 to share the progress that we’ve made.”
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