Speaking to Insurance Business from New York last Friday, Skyward CEO Andrew Robinson (pictured above) confirmed that all of the company’s staff would benefit through the shares.
“We had employees fully involved in everything from the opening bell, to the first exchange and interviews with various senior leaders,” Robinson said.
“We announced to our employees that every employee becomes a shareholder after this transaction, which is the only thing a company can do – allocate capital to every employee.
“Those are mechanical things that we are doing, but what is behind those mechanical things [things]it’s almost a pretty organic, self-reinforcing way that this company engages [with] employees and I am hopeful that we continue like this because it really is our x factor”.
In addition to the company’s new owners, pre-existing backer Westaim, a Canadian investment firm, has held a stake of about 39% in Skyward, which changed its name from Houston International Insurance Group in 2020 after Robinson joined as Executive Director.
The Company is pleased to provide the opportunity to share its successes with its employees by awarding shares to each member of the Skyward Specialty team! #to the sky pic.twitter.com/LViKR6dZC9
— Skyward specialized insurance (@SkywardInsuranc) January 13, 2023
Skyward Specialty Post-IPO Growth Plans
Skyward will use capital raised to fuel growth and for corporate purposes, the company has said. Each of its eight underwriting arms has recently witnessed “double-digit” growth, according to Robinson.
“We feel very good about it; That being said, the world of insurance today is a series of microcycles, not a single macrocycle,” said the CEO.
“Within each subscription division, we have different pricing dynamics, we are in a changing economic environment, and therefore you also have a different exposure environment.”
The diversification has been “really helpful,” and business will grow in whichever of its subscription divisions sees the biggest opportunity, Robinson said.
While declining to “single out one over the other” in terms of future divisional growth focus, Robinson confirmed the three fastest-growing units in the business.
“For some time now, there have been three major investment areas for us, which are our transactional environmental and social divisions, our professional liability and our underwriting divisions,” Robinson said.
“They are the three smallest too, they probably have the fastest growth rate; We are hopeful that it will continue, but we feel very good about the growth prospects in almost all areas of our business.”
Should brokers expect changes to Skyward after the IPO?
While the IPO itself is not expected to have a material impact on the business’s distribution partners, it heralds the “next step” for Skyward in terms of growth and strategy continuity, Robinson said.
“Our thinking here is that there are a lot of opportunities to continue to grow and develop our business to do more for our distribution partners or customers,” Robinson said.
Talent, finding places where the business can have a “meaningful impact” and investing in technology to improve and accelerate the broker service experience will continue to be high on the strategic agenda, according to Robinson.
“All of those things that are critical to our strategy are things that we can accelerate and do more of, with the added benefit of having the capital flexibility of a public company,” Robinson said.
Last year saw an IPO slowdown after a record high in 2021, Reuters reported.
Other players in the insurance market, and those further afield, are likely to be watching the Skyward transaction as they ponder their own potential IPO plans, sources and reports have suggested, though Robinson declined to comment on what the rest of the market you might be thinking.
“I can only worry about us,” said the CEO, who acknowledged that this has been a hot topic in the press.
Why insurtech’s IPO woes haven’t tired Skyward
Insurtechs have dominated the insurance IPO scene in recent years, and while some hit the ground running, long-term share price performance has been widely seen as disappointing. For Robinson, insurtechs and Skyward have little in common.
“I don’t think the performance of the many insurtechs that have gone public that have underperformed really has much to do with us,” Robinson said.
“We are building an underwriting-led, specialty trade-focused insurer; We believe that what we are building is about delivering great underwriting results, doing so at a level that will work across all parts of the market cycle, and as such we are positioned to become one of the few highly valued specialty insurers.
“Instead of looking at the insurtechs, what we do is we look at the really great specialty insurance companies and we use them as our lodestar.”
A continuation of culture
Robinson has said the company has a “compassionate” and “winning” culture, saying maintaining this will be key to Skyward’s continued success post-IPO.
“What worries me the most, more than anything, is not to lose our culture,” said the CEO. “We have built a culture and a commitment and loyalty among our employees that is uniquely ours.”
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