Duck Creek CEO Reflects on 2023 Transition to Private Ownership
(Mike Jackowski, CEO, Duck Creek. Source: Duck Creek.)
Duck Creek Technologies (Boston) one of the most important and enduring vendors of core systems and related SaaS technology to the property/casualty reverted to private ownership early this year with its acquisition by Vista Equity Partners (Austin, Texas). The move recalled a similar transition undertaken by another major vendor—Majesco (Morristown, N.J.)—acquired by by Thoma Bravo, a Chicago-based private equity firm with an interest in the insurance technology space in 2020. Duck Creek’s transaction with Vista Equity Partners was announced in early Jan. 2023 and completed in March, and followed during the year by some important announcements, including key executive appointments. In May Duck Creek named a new Chief Operating Officer, Chris McCloskey, former Chief Customer officer of Datto, a cybersecurity and business continuity company. In July, Duck Creek announced that it would reduce its workforce by 9 percent. In September, the company named a new Chief Financial Officer, Teresa M. Kim, who has an extensive background and history in cloud computing, technology platforms, and “Big Four” public accounting. She joined Duck Creek following a 20-year tenure with Akamai Technologies, a worldwide content delivery network and cloud service company, where she most recently served as VP of finance in the company’s cloud technology group, overseeing $2 billion-plus in revenues while helping the business to build a scaling world-class platform. To get the view from the inside about the latest phase in Duck Creek’s evolution, IIR spoke with Mike Jackowski, Duck Creek’s CEO for more than a decade, and a member of its board of directors.
Insurance Innovation Reporter: Now that we’re several months away from the transaction with Vista Equity Partners, how would you characterize where Duck Creek is today as an industry vendor newly returned to private ownership?
Michael Jackowski, CEO, Duck Creek: The acquisition of Duck Creek by Vista Equity Partners marks the beginning of an exciting new chapter in the history of our company. Resuming business as a privately held company gives us valuable flexibility to enhance our business quickly and take our performance and results to the next level. For more than two decades, Duck Creek has pioneered developing mission-critical core systems for the P&C insurance industry. We enable the industry to achieve agile operations, rapid innovations, and best-in-class customer experiences. The acquisition is a testament to the value of the Duck Creek platform, the success of our strategy, and the strength of our incredible team. Vista will continue to support our strategic growth plans by providing technology expertise, operational guidance, and capital.
IIR: How is Duck settling into the new reality of private ownership, and what opportunities does this present to the company?
MJ: The industry’s appetite for cloud migration remains strong—and for good reason. The pace of digital transformation continues to accelerate and insurers still relying on outdated legacy systems will lose ground to more agile competitors who quickly adapt and exploit market opportunities. This trend continues to demonstrate the value of Duck Creek’s evergreen SaaS platform – providing the industry with the agility and efficiency needed to build modern insurance products and services.
IIR: What’s new at Duck Creek above and beyond the reversion of private ownership, and as a matter of the ongoing evolution of the company?
MJ: There is exciting news on the solutions front driven by our mission to enable customers to achieve important business outcomes. We’ve strengthened our core offering and expanded our breadth of products and capabilities, including reinsurance and payments. Duck Creek, along with our global partners, will continue to support the industry to innovate fearlessly and deliver the premier insurance technology ecosystem to protect the insured. On the People side, we’re thrilled to welcome two new members to the flock. COO Chris McCloskey and CFO Teresa Kim joined us earlier this year to accelerate Duck’s transformation strategy focused on growth and customer-centered innovation – leveraging cloud and evergreen SaaS to design and implement technologies that streamline processes, enhance efficiency, and empower customer success in a rapidly evolving industry.
IIR: Duck Creek just concluded a record-breaking Q4. what contributed to the growth? Is this a validation of the private ownership direction, a reflection of changed economic conditions, or a bit of both? Can you give a few examples? And do you see this momentum continue?
MJ: Our fiscal year 2023 resulted in the strongest bookings year in the history of the company, which was fueled by the continued trend in the industry to migrate core solutions to the cloud. Furthermore, Duck Creek recently expanded to the Indian market, offering its global core technology platform to India-based insurance carriers – a significant milestone in Duck Creek’s continued growth as a leading SaaS choice for insurers worldwide and a strong demonstration of our continued regional expansion in APAC.
We continue to integrate reinsurance management and compliance solutions into our market-leading offerings since the acquisition of Effisoft, helping to drive substantial performance improvements and cost savings across an insurer’s entire reinsurance offering.
Another growth area for us is implementing embedded finance solutions to give carriers incredible flexibility and payment choices. The Imburse Payments acquisition is a proof point of the industry’s need to simplify how businesses access the global payments ecosystem. The cloud-native SaaS platform allows carriers to integrate with existing infrastructure and processes and manage collections and disbursements.
As I mentioned, the industry’s appetite for cloud migration is strong – and customers’ migration from on-prem to cloud encompassed a large portion of success in Q4. We expect to see this continue into 2024 and beyond.
IIR: Where would the industry in general stands with regard to cloud adoption? How might that vary across different lines of business?
MJ: The market has shifted rapidly in the sense that nearly 100 percent of new deal activity and RFPs are from insurers requesting a cloud-based core solution. The majority of the installed base of the industry still runs on legacy/on-premises solutions; however, the trend is certainly to migrate those platforms to the cloud over time. This is about carriers embracing cloud readiness and adopting the cloud on their timeframe. More of our customers are beginning to realize that cloud adoption is the future—whether it’s moving to the cloud via individual core systems like Policy or Claims or going full suite to the cloud. The future of modern insurance ecosystems relies on this migration.
Our momentum continued across all segments of the market and insurers of all sizes, but we have seen much of our recent success with commercial and specialty writers. As we continue in a challenging market, insurers of non-admitted lines, specialty, and mid/large commercial seem to be looking to invest in technology to support their respective strategies. For these insurers, the value of the cloud lies in its ability to accelerate the development of new revenue streams. It enables faster time to market or product development—allowing carriers to leverage data analytics, AI/ML, and automation at scale to build personalized experiences and improve efficiencies while facilitating more digitized workflows. Cloud is driving the speed of innovation in insurance – both internally and externally.
IIR: And now for the question de rigueur of 2023: Where does Duck Creek stand with AI and Generative AI offerings alongside other emerging technologies?
MJ: Generative AI is truly transformative, and Duck Creek is committed to delivering significant business outcomes to the insurance industry through responsible AI and empowering insurers’ embracement of this technology to solve the innovation challenges they face. AI will lead to a meaningful evolution in how underwriters leverage consumer data and conduct risk analysis. It will enhance the efficiency of claims handling, accelerate fraud detection, and help insurers meet customer needs and adapt to feedback promptly. Duck Creek’s low-code platform is powered by Microsoft Azure, and our longstanding partnership with them enables us to harness the power of Azure OpenAI and develop technologies that seamlessly integrate into our customers’ operational landscapes.
IIR: What’s top of mind for you and the company heading into 2024?
MJ: Three closely correlated areas are top of mind for me heading into 2024. We are as close to our customers as ever, which informs and drives our solution development at Duck Creek. Our focus on building humanized experiences allows us to better understand customers’ even greater need for developing connections built on empathy and trust. Secondly, our industry’s transformation includes the entire insurance value chain—from products to services to consumer experiences. It is essential for carriers—regardless of size or location—to surround themselves with the right strategic partners so they can operate in a fast-paced, agile, and highly dynamic market. Lastly, I’m continuing to watch out for emerging technology and its positive impact on our sector. The insurance industry is highly complex, and digital transformation is a journey, not a switch, that companies can flip. This journey requires carriers to increasingly integrate digital technologies as a core element of their vision and strategy—and implement it in a way that simplifies the complex insurance processes with consumers’ needs in mind while remaining agile and adapting quickly to market changes.
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