NewCo Risk

I'm feeling ornery (and grateful) so going to blast some tweets. Here's the first one. Question: If you buy a business, why would an insurance company classify the business you are buying as a new venture? Isn't the point of buying a business to avoid having to start everything from scratch? (Answer below.) Case in point: Email from incumbent ins. broker to biz buyer: "We are going to try and get everything over to the carrier before Thanksgiving but we will be at the mercy of the carrier to review and underwrite and as you probably understand, this is not a risk that can be underwritten very quickly, especially since there is not any past experience. The carriers typically do not entertain new ventures in this space but we have asked for an exception since they have had a very favorable experience with (SELLERS)." Answer: It's the insurance brokers job to drive the narrative. E.g., if the seller has bad loss history and lousy operating controls, then the broker should create distance. If the seller has a great track record, lean into it. The insurance broker should position the deal to get the most favorable outcome for the buyer, period. With what I know about this deal, I would take a very different tact if I were dealing with the incumbent insurer. I'm not going to give away the trade secrets, but there is a subtle art to managing "the dance" with insurance underwriters through a transaction. That's one way @NewCoRisk differentiates, because we have more experience than just about anyone else. (If you can find someone with more experience, please send them our way and I will hire / buy them.)

I have been conspicuously absent on x this month. I just wrapped up my Texas Tornado tour. The highlights include (a) being asked "are you a body builder?" in earnest by the marketing rep from Travelers Insurance , (b) meeting pro bowler, the King of Swing, Mike Fagan, who turned his passion for game into SMB private equity, and (c) supplying these guys with some @NewCoRisk branded beef jerky, which, evidently, at least one of them is mainlining ! The Rice University Texas ETA conference was fantastic. They set a high bar for other grad school, especially considering this in only heir third year. @CBarrett_CPA @SBA_Matthias

Holy smokes! It’s raining awards we absolutely did not have to pay for (just in case you’re wondering). Seriously, we didn’t. I’m bad at lying. Ask my wife if you don’t believe me. Very cool to be honored though. I really like what I do for work.