CEO of broker ‘Ed’ justifies new name; reveals plans to launch in Bermuda

Possibly the biggest single talking point of Monte Carlo 2016 has been the surprise and somewhat bizarre rebranding of broker Cooper Gay as Ed.

Steve Hearn, chief executive of Ed, told Monte Carlo Today that he accepted that not everyone would understand or embrace the rebrand immediately and some of the company’s own board members took some convincing. But he remained comfortable with the new identity and the logic behind it.

“I always knew there would be three ways people would react to the rebrand. There would be those who would view it as exciting, disruptive and dynamic; those who would think I had lost my mind; and those who wouldn’t care,” he said.

Hearn said that when he gathered the company’s 400 strong staff base together in a hotel in London last week to unveil the new brand, this last group was his main target.

“I wanted people to understand that it represents much more than a new name or a new brand—it is a brand new start for this company,” he said.

He admits that some of the company’s board members needed convincing, but former AIG boss Martin Sullivan, the company’s chairman, was very much in the first camp and understood and embraced the idea immediately.

“When the name Ed was first conceived, I sent the presentation to Sullivan, waited 15 minutes and then called him.

“I was nervous but he absolutely understood it and loved it,” Hearn recalled.

In terms of the origins of the name, Hearn’s team initially played with many ideas. He noted that many companies are named after their now deceased founders, or a street name with relevance to the company. He wanted something rooted in the past, but also fresh and dynamic.

“So, 325 years ago, Edward Lloyd’s coffee shop became the place to buy marine insurance. That is the tradition, but we wanted to consider what a coffee shop is today. It is modern, cosmopolitan, advanced and fast-moving—everything Ed stands for,” he said.

Hearn stresses that the story of how the company came to need a new name can be tracked back to when he took the reins of Cooper Gay in November 2015. He had resigned from Willis, where he had been deputy CEO, four months earlier.

At that point, the company, backed by private equity fund Lightyear Capital since it had acquired a controlling interest in 2013, was saddled with $400 million of public debt and was a complex network of operations with little cohesion.

Hearn said his first aim was to clear the debt. The company achieved this by selling Swett & Crawford for $500 million to BB&T. The company also received a $35 million capital injection from its private equity backer.

He then set about reorganising and refocusing the company. He decided to exit retail business completely and sold off various smaller operations which were either unconnected to the core parts of the business or unprofitable.

“We sold or divested a lot of smaller operations,” he said.

A solid presence

This left the company focused on wholesale insurance and reinsurance business. He said the company now has a solid presence in all the major markets globally for risk transfer, with the exception of Bermuda, which he describes as an “odd gap” in the company’s portfolio.

Hearn plans to fix this by the end of the year, revealing plans for a new operation in Bermuda which will employ around five people, to Monte Carlo Today.

“It was an odd missing piece of the puzzle for us and we will solve that by the end of the year,” he said. “I feel Bermuda is more vibrant and relevant than it has ever been, in part thanks to Solvency II equivalence. We look forward to establishing a presence in that market.”

The company’s operational structure is now completely global, he said, comprising three divisions covering treaty, marine and specialty, which includes aviation, managing general agents (MGAs) and a number of other classes, with each responsible for a global profit and loss. This means the broker can service its clients on a completely global basis.

“It is something smaller brokers cannot offer and bigger brokers tend not to do because they have regional units competing with each other,” Hearn said.

“We will not make that mistake. Everything about Ed will put customer service and delivery first.”

He believes that Ed now has the right structure, people, position in the market and brand to offer a genuine alternative to clients.

“People want change. We are often pushing on an open door,” he said. “We offer something different. We are big enough to be relevant and small enough to deliver.”

He is also targeting growth on the reinsurance side of the business. This represents 10 percent of the company’s total earnings at the moment but he believes it has a lot of potential for growth. He has not ruled out entering the insurance-linked securities and alternative capital markets at some point, but he admits the company is not there yet with this ambition.