--:-- Host: This is a very special episode of the podcast. Today, we are talking to Seth Zaremba and Sydney Rowe, the founder and CEO and chief marketing officer, respectively, for Be Atomic, the company behind the Neon platform, the game-changing technology that is going to take our industry to the next level.
--:-- Host: I'm sure if you followed Seth or you followed Sydney or you've listened to this podcast or you've listened to Cass' podcast, you've heard about Neon and you probably have a ton of questions. Some of the things that make it so special might not seem tangible to you or obvious or just may seem foggy or unclear. We dive deep today to talk through those issues.
--:-- Host: Neon and the tools that are coming out from Be Atomic are the game-changing technology of our industry. They are the grease that will move us forward, that will make our industry fly. If you want to be part of it, you have to go to Beatomic.com. On the top, you'll see a link to Countdown. Click on that link and put your information in.
--:-- Host: On September 30th, Sydney and the entire team at Beatomic is doing a live launch, the official launch of the product that people can sign up for and get demos and purchase the product and start to get on the schedule. They're doing a live launch, I want you to be there. I want you to hear this. Whether you're ever part of Be Atomic or not, whether you ever choose to put your company on the Neon platform or not, doesn't matter. You need to know what this technology is. You will not be disappointed.
--:-- Host: I've seen some of the shots. I've seen some of what's coming out. It is game-changing for our space. You at least need to know what it is so that you can make decisions for your business, which may never involve B Atomic or Neon, but you need to know the next 20 years of our industry are not going to look like the previous 20 years. Of anything else, I am certain of that. I don't know exactly what it's going to be, but it's not going to look like the last 20. I think Neon is a big part of it.
--:-- Host: That's why I did this episode. That's why I'm starting the show this way. I want you to go to beatomic.com. There's a button up on top that says, "Get the countdown." It says, "The countdown." Click on the countdown right at the top of the screen. That takes you to a page. You put your name, your email in, and you'll just be notified of when they go live with the launch. Do it. Do it right now. Stop the podcast. Go do it. Then come back. Listen to this show. Make sure you subscribe to the launch notifications. You want to watch the launch. It's going to be incredible.
--:-- Host: I couldn't be happier for Seth and Sid and all the agents like Cass and Cookie and all the rest that are taking part in Neon in these early days. So let's get on to Seth and Sid.
--:-- [Transition to interview]
--:-- Host: I am incredibly excited to have you two on the show. This isn't just, "Hey, it would be fun, you guys have some really cool stuff that is happening." For two and a half, three years now, we have been deluged on Twitter by the maniacal musings of Seth Zaremba as he takes these sometimes passive aggressive, sometimes just complete open right hooks at the industry. In particular, at industry establishments, the lack of transparency, openness, the way that we handle our business, the way that we push forward, the lack of empathy for those who work for us, and providing the tools to our people to really do the job well to provide our customers with a better experience.
--:-- Host: That answer has been Be Atomic and Neon, which I want you to explain the difference between those two things because I get asked all the time: are they the same thing, are they different things? We're going to get to that. Don't answer that now.
--:-- Host: You are launching the product like it's a thing, like someone can buy it as of when this is dropped. Not as when we're recording it, but as when this has dropped, when you're listening to this episode, you can go to a website, you can fill out a form, you can press a button and buy the thing. Is that exciting? What do you guys feel about that? It's a long time coming.
--:-- Seth Zaremba: Are we excited? I feel relieved, stressed, and excited. I'm very excited. It's just an emotion. Here's the thing, right? It's not just about buying the thing, because that's the exciting part for sure. But the message that we're going to share on September 30th when we launch is a lot bigger than Neon. We want people to walk away thinking differently.
--:-- Seth Zaremba: Part of starting the company wasn't just to build a thing that people can buy. It was to shift mindsets and get people to recognize the core issues that need to be solved and not put band-aids on top of them anymore. I think that's what I'm most excited about. And also buying the thing, right?
--:-- Seth Zaremba: And Ryan, being friends, we've been talking about this for a long time. It's taken that long to do this. This is not a $5 foot long that you're just going to run in and get. It's all the things that nobody's ever done. I can tell you it's taken five or six years of politics, of promotion, of irritation, of agitation, of erosion, of conflagration. It's taken all of those things to move the pieces to get to the point where it can get done.
--:-- Seth Zaremba: It's literally take everything that needed to be done over the last 20 years that everybody has ignored, throw it in a box, give it to me and Sid and say, "Go fix it." That's what took so long. To be at this point, to exhale and say, "Yeah, we got version 1.0 of that up there." Is it perfect? Everyone's always like, "Well, why doesn't it do this?" And it's like, "Well, what you're comparing to me is a 20-year mature product." But we're here now, and this is how you get there. You get here right this time.
--:-- Seth Zaremba: Coming out of the box, swinging after a Twitter assault, which, by the way, you taught me how to do on Agency Nation, you idiot. That was you. I was never on social media until you told me to be. I blame you for that. I didn't realize what you were going to do to social media. If I knew that we were going to get seven to 10 of the most...
--:-- Host: I would love to do a word cloud, take every tweet you've done since 2017 and see what that looks like. It was funny. I was part of a mastermind the other day. It was the first in-person mastermind I've been a part of. Big shout out to Tom Larson and Chris Parody for putting it together. It was a great group of agents. You couldn't be... I don't know how to say this in a politically correct way. If COVID freaks you out, this was not the place to be. We were just having a regular time.
--:-- Host: Seth came on. Here's the best part. Spencer Holden, I don't know if anyone knows him. He's one of the most successful, high net worth agencies in the entire country. Absolutely standup guy. I adore him and the way he handles his business. He's a class act through and through. The way he thinks about his business is incredible. Time spent with him is time well spent.
--:-- Host: He's sitting in front and he's got a suit jacket on. Seth comes on with slick back hair on the Zoom in a Motorhead t-shirt. We couldn't see the bottom said Motorhead, Be Atomic or whatever. We just saw the Motorhead part. He doesn't even say hello. He goes, "Who's this guy in a suit jacket at a mastermind? He shouldn't even be allowed in the room."
--:-- Seth Zaremba: Here's the thing about Spencer. He's a beautiful man. He's like a male model. He's my age, but he looks like he's half my age. It is jarring during a pandemic to see a room full of people and then a beautiful man in a sport coat cut and trimmed. You're like, "What are you doing, dude? How do you have that kind of game in a pandemic?" You should have seen Clinger was in the back. He had a three piece suit on with a custom vest and a pocket square. Beautiful people.
--:-- Host: Here's what I loved about it. It felt like we were... There's a point to this. What I thought was interesting about this mastermind was you had guys in the back in t-shirt and jeans, you got Clinger in a three-piece suit, you got Spencer looking good, Parody is always dressed up, Matt Namoli's there in mesh shorts and a long sleeve. Then Seth comes on with this slick back hair, he starts blasting everybody. I was like, "This is why I love the insurance industry. This is the craziest group of eclectic a-holes that exists just hammering out ideas."
--:-- Host: After you did your thing and you talked through it, I think so many people are just confused. They hear the big ideas and the big ideas resonate. They really resonate. Although I've always believed in you, I've never really been in the day-to-day of the building of the product. When I sat down with you guys and I had a chance to see certain aspects of it, I became hooked.
--:-- Host: What I would love is, as quickly as you can, the pitch. If you had 90 seconds to get someone to slam that buy button, what does that look like for someone? Then I want to dig into the deeper aspects. Give them that, not the vision, but the pitch. What is that pitch that really grabs them? Because then I want to talk about all the questions that I was getting after your Zoom, because I think those will let us dig into the meat.
--:-- Seth Zaremba: The reason it's hard to understand is we compare it to what we have, what we know. Everyone asks, "Is it an AMS? Is it a Raider? Is it all that stuff?" Imagine you were just starting from scratch. You wouldn't know AMS. You wouldn't know Raider. You wouldn't know any of the stuff that's built there. How would you start your agency today? If you were starting an independent agency, you just landed here from Mars, and you have one piece of technology that did everything you wanted it to do.
--:-- Seth Zaremba: You would be able to market on it. You'd want all the data that came from it. You'd want your salespeople to be able to track their efforts in it. You would want that on that same piece of technology. When it was sold, you would want it to go to a service person who could do all the functions that insurance people do and service that piece of it. You'd want to pull all of that data together so that you had a complete picture of your process at every part.
--:-- Seth Zaremba: That's what NEON is. It takes all of those things and puts it in one system, one dashboard. I call it the Tesla dashboard. Now you can see and do everything you need to do. Every core insurance function: marketing campaigns and AdWords and all that stuff, sales tracking, pipeline views, endorsements and changes. But it does it in a completely different and trackable way. We put stuff in packages. We put those packages in one picture and those packages tell a story of what's happening in your agency, with your customers, with your people, and with how you're interacting with your customers.
--:-- Seth Zaremba: This is where Sid usually bails me out.
--:-- Sydney Rowe: I was just going to put a cap on it with the 2.5 seconds that you left me. The problem right now is that our systems only track outcome. What policies were created, what policies were sold or canceled or renewed or modified. That's an outcome. As a business owner, what we're constantly trying to figure out is how to change that outcome. How do I modify policies faster or do less modification on policies? How do I create more policies? How do I lose less policies?
--:-- Sydney Rowe: When you think about how to change outcome, the answer always rests in the behaviors of people who create those outcomes: your marketers, your sales team, your service team, your carrier partners, your clients. Our goal with NEON is to capture a full picture of all of those behaviors and line that up for you so that you get a really granular look at why things are happening in your agency so that you can change those outcomes.
--:-- Host: One of the things that has really opened my eyes in the last six weeks to what you guys are doing is around conversations that I've been having, particularly with agents that are using VAs. COVID has created a new dynamic in our agencies. It has legitimized every setup for an agency. You want to be a five person local agency where everyone sits in the same office? That works. You want to be five people scattered throughout the country? That works. You want to be a one woman show that has 17 VAs working behind her? That works. You want to be some mashup of every iteration of that with technology? That works.
--:-- Host: In COVID land, there are no rules. The legacy has been smashed against the rocks. All these agencies that have been told for so long that you had to do it a certain way, that the best method was 50 miles from your office, all of that has been smashed. I could name a dozen agencies right now who do not operate that way that COVID had zero impact on. They weren't running out to Best Buy to buy laptops. They weren't struggling to remote desktop into computers in their office. Their people just kept working as if nothing changed.
--:-- Host: In this distributed, widespread, highly diverse agency force that now exists, who are not just connecting with the three to five big nationals, but are integrating the three to five big nationals in with InsurTechs, with super regionals, with captives, with all these different carrier partners and vendor partners, you need to have a tool. Understanding behaviors is what actually matters. You can't track outcomes in the way that we have, the way the previous systems were built. You cannot track the outcomes today and outcomes don't give you the information you need the way they used to. It is a completely different world.
--:-- Host: You need this idea of cases. I'd like you to talk about that. I think you call them packages maybe, but this idea of cases. I've started just using cases in my everyday terminology, even though I don't have the tool yet, because this just resonates with me.
--:-- Seth Zaremba: Let me take you on a journey and I'll use music to illustrate cases. I imagine there was probably a saloon in the 1800s you walked in and there was a guy at a piano. You put your two bits in and you got a song. You got your whiskey and a song. Then somewhere in the 50s, they're like, "Hey, we need to take more money off of just a song." So you got those 33s. You got an A side and a B side. The A side was the song you want and the B side was a piece of crap that you had to just pay for.
--:-- Seth Zaremba: Then somewhere in the 70s, 80s, and 90s, we got albums. You got two good songs and you got 10 songs you didn't want. We bundled up all of the bad stuff with the two things you wanted to raise the price. We went from two bits to three bucks to... I remember the last CD I bought was like $21. And I wanted one song. Then what happened? All of a sudden we said, "No, no, no, let's start unbundling stuff. Let's get down to what I just want: the song. I want to build my own playlist."
--:-- Seth Zaremba: When we go on our phone, we just want the thing. We don't want all the crap that comes with it. Cases says, "Listen, all of insurance has been bundled up into these agencies or into these departments or into these books of business. There's good stuff in there, but there's so much crap we can't see and get to." What these cases do is break down these albums with probably three good songs on it and eight really turd songs. It says, "Hey, listen, now you can see where the losers are and you can see what the winners are. Now we can start to address what's really happening."
--:-- Seth Zaremba: Is it the customer we have? Is it the employee inside of our agency? Is it the carrier service or underwriter that we're working with? Now we can see where the problem is on the album and we can break that apart or we can solve it. Because we have these interactions, these cases built now, we can go to carriers and say, "Hey, look at these cases. Me, Ryan, and Sid, we've got 50,000 of these things all with you all around this process and you take 50 days longer than everyone else. Do you have a solution that can fix it?" "Yes, we could do this process." "Great. We'll take that hose, plug it right into all 50,000 of those cases, and we'll knock 49 days off that process."
--:-- Seth Zaremba: That's what we really do by breaking up these albums and just giving you the song you want and letting you build a playlist within your agency.
--:-- Sydney Rowe: Here's the unique part about the case system. If anybody's familiar with the ticketing system, it's similar to that. It's a service transaction. It's an organizational mechanism to capture service transactions. The difference is we operate in a very unique environment where manufacturing is completely separated from sales and service. Ryan, you actually brought this up to me a few months ago when we were talking about that disconnect.
--:-- Sydney Rowe: You said, "Well, in other verticals that's okay. It still works because manufacturing is creating 100,000 tennis shoes and then they're sending all those tennis shoes to sales and service in December. Then sales and service goes and sells them. The amount of communication needed in other verticals isn't as frequent or important." However, in this industry, not only do you have that disconnect, which is a difficult thing to deal with, but you also have a frequency of communication high above any other vertical.
--:-- Sydney Rowe: Custom one-off insurance quotes every single week, every single day. Having to communicate on the sales side, claims issues, adding or moving policies. The amount of communication needed between manufacturing and sales and service is endless. The case system was specifically designed for that environment where we're capturing the client's behaviors, we're capturing the employee's behaviors, but we're also bringing in the carrier partner's behaviors. That's not something you can find in other pieces of technology. It's hard to create that.
--:-- Host: When I think about it, and when I shared that idea with you, it wasn't all the way fleshed out. What was in my mind at that time, and since I've had a little more time to think about it, is in a traditional manufacturing distribution system, I would say I need 100,000 pairs of shoes for my stores. I place an order. 100,000 shoes hit my stores. I distribute them out to my stores. I now have 100,000 pairs of shoes to sell. I might not have to re-up for another month. I may not have to re-up again for three months.
--:-- Host: In our system, it is every day. In some cases, thousands of times a day, multiple interactions on the same deliverable, on the same piece of merchandise. You might have seven touches on the same piece of merchandise. Every single one of those is delay, delay, delay, delay, and then snap forward. Delay, delay, delay, snap forward. With a traditional manufacturer distribution system, I place my order. I know it's going to take two weeks. Two weeks later, the order comes in. There's usually a standard deviation from a delivery date.
--:-- Host: In our world, I just had an account come in where I submitted it to three carriers. One of those carriers, I placed the business. I needed it by the end of the week. I put the quote in on a Monday. I needed to place the business on a Friday. I placed the business on a Friday. Two weeks later, one of the carriers gets back to me and goes, "Hey, here's your quote. Was that effective date solid?" I was just like, "You got to be shitting me." Yes, the effective date on the quote was solid. It was a renewal date. That's when the person needed insurance.
--:-- Host: The gall of that carrier to even send me the proposal two weeks after the effective date and then go, "Oh, was that a solid effective date?" These are the kinds of things when I think about what at a very basic level you are solving. That's a forgotten transaction. That transaction with that particular carrier, that's forgotten. We placed the business, no big deal. What we don't think about is time spent submitting that business to that carrier, the time spent dealing with the fact that now they just sent you that renewal tracking.
--:-- Host: On average, it does take three weeks to get a proposal back. When I have an account that's renewing in five days, don't even bother submitting it to them. We lose. We're talking about one little microcosm. That was what really opened my eyes when I started to see the second and third level data that you guys were showing me from Zinc. I was like, "I'm not there yet as an agency. I'm just not having that many transactions." But oh my God, you can just see it. You're like, "Holy crap. This is so much lost time." How many deals do you lose because you're spending time submitting business to carriers that are just eating up time in your day that you should be spending on something else? If you had that depth of knowledge, you can make those decisions.
--:-- Seth Zaremba: The cost of operations have changed. The margins aren't there to support that fluff anymore. Go back 15 or 20 years when people were getting 20%, they were getting bonus from carriers, they're making profit sharing contingency, and they had no technology costs. Their people didn't want raises and benefits was relatively stable. Just give people a bag lunch and a trip to Cedar Point once a year and they were happy. We don't live in that world anymore. The margins have collapsed. The cost of employees and the cost of these transactions in the aggregate are where our profit's going.
--:-- Seth Zaremba: I'll give you an instance. Bell in our office last year did 3,860 certificates. At $3 a transaction, I spent $11,500 last year punching keys to make a piece of paper to give someone else to go get a bond so they could go do work. That's a place I need to fix. That should be a dollar transaction, a quarter transaction. That should be a free transaction. Now Bell, a really qualified 22-year industry vet who is really good with people, is not doing stupid human tricks on a keyboard. They're actually talking and consulting.
--:-- Seth Zaremba: If you think about it, we've broken things into these activities. These activities now have a cost and a profit associated with them. Now we know where we're making and losing money. We know where we need a VA and where we don't. We know where we need to scale and where we don't. It might be technology and seat licenses. It might be employee training. It might be a number of employees. It might be physical location. We may not need our office. But if we can't definitively say that at scale, then we're oftentimes just looking for the magic pixie dust. "Oh, I want new software. I want a new tool. I want a Google review because that's going to save me."
--:-- Host: One of the criticisms that I've gotten, because I've been so vocal in support, a lot of people ask me questions. Some of those things I just tell them I simply don't know the answer to. One of the criticisms is, "How does this make me more revenue? How do I write more policies?" Convincing someone that your widget will have them write more policies is the ultimate way to sell insurance agents shit. For everyone that's listening, if someone tells you that their widget can help you sell more policies, you unconsciously gravitate to listening to what they have to say. Even if it's just another thing that you're never going to use, or if it doesn't actually work, if they go, "I can have you selling more policies using this thing," you'll listen.
--:-- Host: That criticism is fair because your guys' marketing isn't about a direct new bell and whistle three-step process that gets people to click a buy button. You're talking operations. You're talking efficiencies. How do you address that criticism, whether it's fair or not?
--:-- Seth Zaremba: [Laughs] Okay, Sid is telling me to go first. Well, my camera's not working, so I was like...
--:-- Sydney Rowe: He's sending me bats. That's all right. You go first.
--:-- Seth Zaremba: So what was the question? Sorry. It doesn't sell more policies. This is not going to sell more policies and we're not saying it is. What we're saying is there's a better way to run. It'll do a lot of the things that participate in success, one of which is being more productive around marketing and sales.
--:-- Seth Zaremba: Here's what I would tell you. 12 years into Zinc, what it has done is taken my retention from an 87% two years ago to a 95% today, 96% today. A 10 point jump on retention. I'm a 2.35 million revenue shop. Times 10%. That's $230,000 of revenue that having system and process and understanding around what's happening with my customer, the people inside my agency, and my carriers has had a huge impact. NPS, 30 point jump. Sales has definitely gone up. We've grown $4 million organically over the last couple of years because we have integrated marketing. Marketing now works with service and sales.
--:-- Seth Zaremba: Getting more horsepower out of a motor is not always a swap. It's tuning it, it's adjusting it, and it's getting the way. Rather than telling people to buy new motors for your car, we looked at it and said, "You got a really good chassis. The independent agency plant is a heck of a chassis. It's a great motor, but it has not been tuned. It's choked. It needs to be tuned up and blueprinted and balanced so that it can run." That's really what we do. You'll run higher retention. You'll run better customer experience. You'll get sales and you'll get visibility into where your problems are. Then you got to be a man and step up and do the thing. No offense, Sid. I didn't mean man in the sense of like a male. Be the dude, be the thing.
--:-- Sydney Rowe: I'll forgive you your lack of wokeism, Seth.
--:-- Seth Zaremba: I know. I'm an old man elitist bastard.
--:-- Sydney Rowe: Here's my take on this. You don't need another shiny thing. If I've learned anything in my seven months at Rogue Risk, it's that shiny things don't sell shit. They don't. Just about any tool can help you grow if you're doing the right things. If you're reaching out to the right people, if you're making phone calls, if you're sending the right emails, if you're connecting with people, if you're asking for referrals, if you're finding referral partners. That's how we sell things. Yes, you can do PPC. Yes, you can do paid ads. Yes, you can buy email lists. You can do all the things. You want to know why? It's fucking Salesforce. It can connect with anything.
--:-- Sydney Rowe: I answer that question with, I think it's a fair criticism at face value. I think it is a shallow and short-sighted criticism of the platform in terms of what it actually is doing and the problem that it's actually solving for our industry. That to me is super interesting.
--:-- Host: The next criticism that I've received is that it's just a lot. It feels like a big undertaking to get involved with. Not that Epic or EMS isn't a big undertaking, but it does feel that way. A lot of the newer systems that have come out, like certs or QuickFusion, they feel simpler, they're easier. I don't mean simple in a way that it doesn't work. I just mean they have a low barrier to entry. Do you agree? Is it a big undertaking or is that just a perception because Salesforce comes with that and it really is nothing more than what you would expect?
--:-- Host: Well, I've definitely heard the phrase, it's almost too powerful, right? Like why does an insurance agent need a Lamborghini? They just need a car that gets them from point A to point B, which I feel like is undervaluing insurance agents to be completely honest when I hear people say that.
--:-- Host: I guess when you buy for the future, right? If you're trying to buy a piece of technology that solves today's problems, I'll never forget sitting in my dad's office and he was picking between two agency management systems. They both came in. This is pre-COVID, so salespeople actually coming into the building with their sheets and we were going through everything. I sat there and I'm like, "Dad, how are you going to make a decision? It seems like they're neck and neck." Nobody had anything that was particularly special, and they were about the same price point. He sat back in his chair and said, "Sid, I'm going to go with the one that thinks about the future." It wasn't what they were saying. It was the vision they were pitching me for the future. That moment has always stuck with me because to my dad, he wasn't just buying a piece of technology. He was investing in his business's future.
--:-- Host: So I would say that, right? If you want a simple tool that can do a simple thing in one piece of the value chain, go out and buy the widget. If you want to solve the real problems and set your business up for the future, it's an undertaking.
--:-- Seth Zaremba: The time for honoring them will soon be at an end. There is no reality that anybody can paint to me in the next five to six years where we are still batch processing 30-year-old data sets back and forth. There is no sophisticated sales organization I can picture in the next few years. In my place presently, I could never go back to a place where I didn't have an understanding of how marketing is generating leads and sales producers are contributing towards success. There's no economy that's going to let us have fat and fluff in the system. If you think there's an economy that is going to let us just get by in 2020, I cannot concede. There's no future I can imagine where having data doesn't make you more valuable, more capable. All of that comes with structure.
--:-- Seth Zaremba: Ryan, your last podcast with Chris Burren, he talked about clean data. Oh my goodness. If you want to talk to me, just listen to that podcast. If you don't have clean data sets built in the 20th century, 21st century for a 21st and 22nd century, you don't have an agency. You don't have a business. You're in seat retired and you're getting by, but you don't know that you're going out of business. I've always been a guy that skates where the puck is going. This is the world that is coming your way. I'm in those meetings. I'm talking to the carriers. I see what's happening. I am not being a fear monger. It's happening. A data-driven world where data is moved between agents and carriers to improve the customer experience or pricing, I'm doing it. Data for sale, I'm doing it. So I don't care if you think it's too complicated, but imagine a future where this isn't happening because I can't see a present where it's not happening.
--:-- Host: I think that episode with Chris Byrne was groundbreaking. I think the place that he went at the end around the ideas, and if you haven't listened to it, just go back in the episodes and find it. He basically broke down, I asked him with about 10 minutes left in the show, "Okay, we know at a basic sense how to come to a valuation for an agency today. We either take EBITDA or you take top line revenue and you have a multiple. You're going to pick one and you're going to pick the multiple based on a couple of factors, retention, business makeup, maybe some other things, how the owner actually wants to be paid out. But ultimately, that's how an agency gets value." I said, "If you could pick one or two things that is going to drastically impact how we value agencies moving forward in the future, what's that going to be?" He immediately without hesitation said, "Clean data."
--:-- Host: My eyes have been opened, man. Seth, you and I have talked about it. Sid, you and I have talked about it. We talked about it a little bit when I was in Ohio with you guys a couple of weeks ago. My eyes have been opened so much to the realities of business. A lot of agencies are probably like, "Duh, right?" It's easy to talk about it, but once you're living it, it's completely different. That has happened. One of the things that I've realized is for all the fanciness of some of the tools that I have, and the tools are great, don't get me wrong, I mostly write business from people that email or call me. They see a website article or they know a friend of mine or I cold call them or I send them a postcard in the mail. The system itself isn't selling the business. Everything about my agency that keeps me from writing more insurance is everything that happens during the sale and after the sale. That's what's keeping me from being more successful. It's a lack of understanding, using all these different things. I have to wait for a download, this downloads differently, I have to reconcile this, this carrier doesn't download, this carrier does. I have all this disparate information and systems. I literally have a human being who sits in the Philippines now whose sole job is figuring all that crap out and putting it into a system. Then he's got to put it into three systems because no one system that I have can actually do everything.
--:-- Host: I look at that and I say to myself, there has to be a better way. That's what you guys have created. I look at some of the people that have adopted the product, Christopher Cook, Jason Cass. I was talking to Andrew Darlington, who was in the mastermind in Boston. I look at the way that these agency owners operate and the way they think about the future. I say to myself, what do these individuals have in common? There's probably a few things, but what stands out to me the most is they understand one core idea: the way agencies were built for the last 50 years cannot be the way that an agency is built in the next 50 years. It is impossible to do it the same way. If you're using the same tools and the same processes, you are not going to be successful. I unfortunately see it every day in the questions that are asked in IOA or in some of the other groups that I'm in. It's not those people's fault, but they have not been shown or exposed to the idea that they're following a path that was trod 40 years ago. It's grown over. There are trolls under every bridge, dragons swooping down over the trees just waiting to pick them off. You just can't walk that path anymore. It doesn't exist. It doesn't go anywhere.
--:-- Seth Zaremba: Think about this, Ryan. For all those guys you mentioned, 95 to 96 percent of their revenue comes from renewals. We spend so much time in conferences talking about the six to eight percent of revenue that comes from new business, which is important. You have to have that. But we just ignore the 96% of the operations where almost 100% of our cost is and where all of our profit exists. That should just be unchanged for the last 40 years? It's ridiculous. If you talk about agency valuation, when you sell your agency, Ryan, what are you selling if not data? Are you backing up a truck of files anymore? The people are gone. You know that the second these guys buy you out, the people are gone. The office is gone. There was no paper. What are you buying except for data? If that's what you're buying, then the quality of the data, the volume of the data, the structure of the data, and the integrity of the data is what's going to rise that asset.
--:-- Seth Zaremba: Because it's data and because you've structured it the right way, you can now balance it. A book of business is not just a big piece of paper with names on it. Just like your retirement is not just stocks, it's an asset allocation. Your books of businesses are assets. As data stacks, they now have independent businesses and they will move in different ways. They will have different values. In the future that is now, no one's going to come and buy bad data, unorganized data in big chunks. They're going to break it down and say, "Hey, this doesn't look good. I'm going to devalue that. This is unorganized. I'm devaluing this. I didn't want this in the first place. I'm devaluing that." If you look at the value of your agencies, that's all it is, is data. That's all you're going to be selling. If you've got low quality or no quality data, good luck to you.
--:-- Host: This is the way I think about it too. This is a relationship business through and through. We sell on trust. If people don't trust you, they don't buy from you. There's no gimmick or scheme that you can play that lets you run a successful business in our industry when you don't have trust. People want to bang on Geico all day long. There are an incredible number of Americans that trust Geico and that's how their business survives. It's not the advertising, it's that the advertising has built trust. We can think that's crazy, but that's what it actually is. In today's world, that trust moves so fast. Because there are so many options and we're so exposed to those options, one false touch, one insincere action can drastically change the nature of trust that your clients have with your agency.
--:-- Host: Ten years ago when you're selling your agency, what did you do? You'd sell, you'd do nothing. Then a year later, you'd send out this mailer that would say, "Hey, just so you know, John's not here anymore. He's gone. But hey, you've been with us for the last year and you didn't know the difference. So it's all good. Stay with us." People would go, "Ah, whatever. Things have been fine." That's not the way it works today. Touch points, touch points, everything changes. If I don't have the ability to use the information and data that you have to reestablish trust with your clients quickly and on their terms, knowing do they like to be contacted via text? Do they like email? Do they need a phone call? Who are my VIP clients? Who are my high touch clients? Who are the clients I don't care if I lose? Who are the clients that I absolutely have to retain? If you don't have that information in your agency, that is a major problem.
--:-- Host: What happens is you don't retain it. How do you get paid out as a principal? You get a nut up front and then you get paid out based on the retention that you're able to keep over the next two to three years, depending on your contract. If your data sucks so bad that you can't retain that business over time, you're losing money. That's just a fact. From that very selfish standpoint, clean data is a must. I'm not saying that Neon is the absolute only way to do it. I just think you are setting yourself up for a lot of headaches and a lot of failures if you do it a different way. It was built to be done that way. We don't have any legacy baggage to overcome. It was built for that. Here in 2023 and 2024, we will sell books of business as assets to each other. Neon has built the way for me to say, "Hey, I've got 300,000 of non-performing clients for me and my agency with Rochester Mutual. I think Ryan would love Rochester Mutual. You want that and all the data?" "Yeah, great. Push the button on your end. I push it on my end. Boom. Here all my clients. Here all the data. Here every phone call. All this stuff. Five minutes. Transaction done."
--:-- Seth Zaremba: We will build an economy where we move these assets back and forth. We will take illiquid assets such as books of business and turn them into liquid assets which you can now borrow against and trade against and sell against and allocate against. You have this asset called data. It is going to be liquefied by the marketplace, either to you or by you. You might as well do it yourself. If you look at our pipeline for where this goes, there is a whole economy built on the idea that if your data was put in right, if it's structured right, if you've got it clean, and there's a way to move it, all of a sudden this thing that you had to wait 30 years to sell one day to your son or daughter or the guy down the street, it can be moved at any time, any way. It can be moved for underwriting. It can be moved for sale or transfer. It can be moved for aggregation. There are all sorts of things you can do once your data is set and it's platformed. That's what we're doing.
--:-- Host: So I'm sitting here and I'm an agency owner and I'm listening to this and I'm probably still a little confused if I don't already believe in these ideas. But I think at the core, the takeaway should be, and so people listening know, I'm on the path to being a Neon agent. I'm still a little small, probably. Seth and I have talked about that. I'm setting my system up and the systems that I'm actually using today are intentional so when I'm ready, I can make that move. I want to be transparent that I'm not on the platform yet, but that's mostly just because I'm seven months into owning my agency. We are not paid advertisers either.
--:-- Seth Zaremba: No, no, no. This is just because I believe in this.
--:-- Host: I appreciate it. So if I'm sitting there and I'm thinking about this, I think it's fair to say this is an undertaking in your agency. If you're not already believing to make this move, there are some philosophical shifts that you have to make. I don't think that Seth, nor Sid, nor myself, nor Cass, nor Cook, or any other advocates out in the ecosystem would sit there and say, "So you're sitting there and you're thinking to yourself, I think this is an undertaking." There is a philosophical shift that you need to make. I think the argument against this, which is you can make personal income without it, I think that that is logical, which only validates the idea. Yes, you can do nothing and make personal income. The problem is you isolate yourself, you limit yourself, and you ultimately never allow yourself to step out of your business. You never allow yourself the ability to dig deeper and make the decisions that can really create an ongoing entity.
--:-- Host: Seth can drop a marketing program into your hometown and start picking your clients up and be four states away, and understand completely how much he's spending, who's working on it, how much time is there, what his profit margin is, and he can reinvest in the places that make sense while you're just going, "Geez, I wish I had more referrals." That level of sophistication is where we're going. That is not science fiction. There are a few agents doing this. I talk to agents every friggin day who are thinking about this stuff at this level. This is absolutely the future of our industry. At an absolute minimum, if you've listened this long to this show, you need to get a Neon demo. Know what this product is doing. Know what it can do. Have it in your holster for when you're ready. There will be a day. It might not be this month. It might not be six months from now. But I honestly believe that this is going to be an enormous move. In the next two to five years, this will be the standard. It will be the standard of how we operate.
--:-- Host: I just appreciate the shit out of you guys. I know you've taken more stones and sticks and barbs and jabs and had more people question what you're doing than maybe any other initiative in a very long time in our industry. It's a paradigm shift and that's not easy. You guys have done it. You're launching this product. You have paid customers. You have people already on the platform. You have proven cases. I couldn't be more proud to have you both as friends and be more excited for today. I just thank you for coming on and sharing.
--:-- Seth Zaremba: I appreciate that, dude. It's funny because when we first started down this mission, the biggest critique we got is you're not going to find agents who are interested in it. 365-ish days in, we're like two weeks out of our year mark. We have a pipeline of 400 agents who have all asked to talk to us and see what's going on. I have not had time to talk to all of them. We're already filled up for the end of this year and the beginning of Q1. I only say that because I just heard it in the way that you closed us out here. We're so used to talking to the entire indie agent channel as if they're all the lowest common denominator. It is the most ridiculous self-fulfilling prophecy because that's what we're told every day. "Oh, you're just the insurance agent." Enough. You're better than that. The people listening to this phone call know they're better than that.
--:-- Seth Zaremba: Come on September 30th at 10 a.m. Eastern. Watch what we're talking about. It's not about Neon. It's bigger than that. It's thinking about yourself, believing in yourself, and being a leader in this industry. There's no better time to be a leader than right now. This is the time. I would say to all of those listening, I can't wait to talk to you. I'm so pumped. There are more people out there like you than you think. We got to stop with the nonsense of the indie agent being the lowest common denominator. We're better than that.
--:-- Sydney Rowe: I would say this. Everyone told me that all I would hear is no's. I can honestly say one year in, I've not had one no from an agent. Everyone said carriers will tell you no. I've not had one no from a carrier. Everyone I have had, "I can't do it right now," or "That's too baller for me," but I have yet to have a no. The reason I say that is because it's right. I came home last night and I was talking to my wife, Jen. She's like, "Man, you look beat." I'm like, "Honey, I know I'm right. The rest of the world's going to figure it out." I've mortgaged zinc. I've mortgaged my house. I've sold cars. I'm basically broke. But I know I'm right. I know this is the thing. Is it perfect? No. But this is the chance for agents and carriers to come together to make the channel world-class and to do the thing.
--:-- Sydney Rowe: If I'm wrong, then you won't see me again. You won't hear me again. I'll be the joke. I don't care. I'm not in it for that. I'm right. You may not like it, but this is the right way to go. If you're a carrier, if you're an agent, this is the right thing. If you want to do the right thing for your clients, if you want to do the right thing for your people, if you want to do the right thing for your carrier partners, and if you want to do the right thing for yourself and your family, then give me a look. I'll buy you a steak dinner if you tell me I'm wrong. I don't think I'm buying many dinners. You may tell me "not for now" or "you're not ready" or whatever, but I ain't wrong and I know it. I'm not going to fail on this. We're right and it's time.
--:-- Host: If they're listening to this before September 30th, where do they go?
--:-- Sydney Rowe: Beatomic.com.
--:-- Host: And what is happening just super quick? There's going to be some sort of something happening.
--:-- Sydney Rowe: Up till this point, I think we've been kind of mysterious about what we're up to. We've tried to film as much of the journey as we could and be as vulnerable as we can about the process, but the solution itself and the mission in its entirety hasn't really been shared. On September 30th at 10 a.m. Eastern on YouTube, we're going to live stream a Neon demo and talk to the mission of BeAtomic in its entirety and where we're at and where we're going. If you have 60 minutes, that's all it takes. You'll get a bit of a BeAtomic fire hose, but I think you'll walk away not knowing what we're doing for sure, but thinking a little bit differently about where to go and how to start thinking about solutions in the future.
--:-- Sydney Rowe: If they go to Beatomic today, they can sign up for an email to get notified. Go to Beatomic, punch your email in. You'll get an email on the 30th at 10 a.m. to join this live show. This is the place you want to be. Make sure you subscribe to the BeAtomic YouTube channel if you do that kind of thing.
--:-- Host: I'm excited for you guys. I'm an observer. I watch from afar. Obviously you're both very good friends of mine and I love you both dearly. I'm just excited for you. I can't wait to see where this goes. I can't wait till I can be a part of it. This just feels right to me. There's nothing easy about it, I know that. But everything in me, every conversation I've ever had tells me that this is the path. I'm just excited that you guys are the ones that are bringing it to us. I just want to again say thank you. Everyone listening, just show up at the YouTube, watch the show, share it, talk about it. It's important, whether you agree or disagree, the conversation in and of itself is important. Whether you participate and become part of the Neon platform or you don't, that is less important than the conversation at large. The people that it does resonate with, that it is the right time for, they're going to be drawn in and it's going to work for them. Just engage, guys. That's my biggest ask from you. Engage. I do think this is as important as it gets.
--:-- Host: Thank you to you both. I know that Neon is going to be wildly successful and this will not even be close to the last time that we talk about it. I'll probably have you on every couple of months to talk about what's going on and do updates. I just wish you a ton of success on the 30th. I'm so excited.
--:-- Seth Zaremba: Appreciate you, dude.
--:-- Sydney Rowe: Yeah. Thanks, guys.
--:-- Seth Zaremba: Yeah. You go fuck yourself with your fat fucking ass. Do you want to have a few drinks and smoke a joint, Bubbles?
--:-- Sydney Rowe: Yes. Thank you. Thank you. Do you want to have a few drinks and smoke a joint, Bubbles? Yes.
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