Mark E. Jones is a Co-Founder of Goosehead Insurance, Inc. and has served as its Chairman and Chief Executive Officer since inception in 2003. Under his leadership, Goosehead has grown to be counted among the largest and fastest-growing personal lines insurance agencies in the country.
Prior to joining the company, he was a senior partner and director of Bain & Company, the global management consulting firm. Earlier in his career, he worked in the audit and mergers and acquisitions practice groups for Ernst & Young. He holds a Bachelor of Commerce degree from the University of Alberta and an MBA from Harvard Business School.
In this 3,375 word interview, exclusively in the Wall Street Transcript, Mr. Jones details how he and his wife started an insurance company from scratch.
“First of all, the industry is enormous. There’s over $300 billion a year in personal lines, property and casualty insurance, in the United States — over $300 billion. It’s highly fragmented, so you can build a really successful business, and no one has enough market power that they can stomp you out or get in your way.
There’s just too much fluidity; there’s too much white space in the market. My hypothesis was that it would be very recession-resistant, because if you live somewhere or drive something, you have to buy our product, or you have to buy the product from someone. And that has very much proven to be the case; it’s highly recession-resistant.”
Goosehead prides itself on the economic advantages derived from superior customer service:
“One thing that is very unique — and this doesn’t so much relate to carriers as it does to our own economics — every day, the first email that I see are the call statistics from the prior day. That include things like call volume, hold times, abandonment rates, net promoter score, all of those things; they’re all measures of quality.
We never really benchmarked our cost to deliver service because I know that the longest economic lever in our business is client retention, and so I was prepared to spend what we needed to in order to drive high levels of client retention.
What we found when we did our IPO last year, we did benchmark our cost to deliver service, and we were a little bit surprised to learn that it costs us about 25% of industry best practice — not industry average, industry best practice — to deliver the best service in the world.
And we kind of scratched our heads a little bit at first, trying to figure out how could this be, because we really haven’t focused on managing costs. We focused on delivering quality. What we found is that we took all of the friction points out of delivering service, and those friction points are what drive costs.”
Get the full detail on this successful insurance start up by reading the entire 3,375 word interview with the CEO, exclusively in the Wall Street Transcript.