Bootstrapping to $15 Million: Ernie Bray, CEO of ACD (Part 4)

Sramana Mitra: Essentially, the $400,000 in the first year was from about 8 to 10 deals?

Ernie Bray: Yes. We had about 8 to 10 clients.

Sramana Mitra: These were clients that would remain as recurring revenue clients, because they would continue to use your system and the pricing model is based on number of claims processed.

Ernie Bray: Right.

Sramana Mitra: What year did you start again?

Ernie Bray: 2004 was our first full year of business.

Sramana Mitra: What is the next major strategic move or milestone?

Ernie Bray: During that time, our biggest move was when we started our business, we led our marketing with our services first and technology second. Once the insurance companies started to see that the technology was far superior to many of the legacy providers out there who have been around in the industry, then we started to shift that whole sales model towards the technology first and the services second. What we did is something that nobody else in the industry had done.

We were both a technology and a services company because in our space, either you’re a technology company or you’re a services firm. My whole thought process was, “Why not mesh both of those together to create a unified solution that an insurance company can come and have everything in one location?” They can have the services and the technology all meshed together. Once we did that, we got on to a growth phase. We were on the Inc. 5000 list for five straight years from 2009 to 2013.

Sramana Mitra: I have one key question to flesh out here based on what you’ve said so far. What kind of services? Are you outsourcing the whole claims processing, and did you have a workforce using your technology and delivering the services?

Ernie Bray: We built a network of independent vendors that went out and did this claims services. We built the vendor network so that we could outsource all the services they needed to handle the auto claims. We take the heavy lifting away from the insurance company because then we have a whole national network. We started to expand nationally. We created a national network of vendors that we contracted through our technology.

Imagine our technology platform being the solution that the client comes into and then when they have a claim somewhere, they can pull down from the vast network we’ve developed and then send it to somebody in New York or wherever. They can dispatch out to that network of businesses. We created a network of services providers and we gave them the technology platform to be able to manage everything.

This segment is part 4 in the series : Bootstrapping to $15 Million: Ernie Bray, CEO of ACD
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