Episode Summary
Executive Summary: Chris Ackerman of FlexPoint Ford explains how the firm’s subsector expertise and relationship-driven approach led to a successful investment in Tiger Risk, a reinsurance broker and capital advisory firm. The deal was delayed by COVID and financing disruption, but creative structuring preserved value. FlexPoint then benefited from talent recruiting, growth, and eventual sale to Howden at a strong multiple.
Main Topics: FlexPoint Ford’s subsector strategy (Priority: 5/5): FlexPoint focuses exclusively on financial services and healthcare, with deep subsector specialization and founder-backed investments as a core edge. Tiger Risk’s business model and differentiation (Priority: 5/5): Tiger Risk combines reinsurance brokerage with capital advisory, positioning itself as a more creative, holistic alternative to the large global brokers. Deal sourcing and relationship-building (Priority: 5/5): FlexPoint’s prior client relationship and years of engagement with Tiger Risk created conviction, trust, and access that helped source and win the deal. COVID-era deal disruption and creative financing (Priority: 5/5): The transaction nearly broke during the early pandemic due to market volatility and debt withdrawal, but the parties restructured the deal instead of cutting price. Culture and talent as growth engines (Priority: 5/5): FlexPoint used Tiger Risk’s culture, equity incentives, and market disruption to recruit talent aggressively and expand the platform rapidly. Exit to Howden and strategic fit (Priority: 4/5): Tiger Risk was sold earlier than expected because Howden offered both a compelling valuation and a culturally aligned home that preserved the platform. Lessons for private equity investing (Priority: 4/5): Ackerman emphasizes trust, patience, culture, broad equity ownership, and planting seeds long before opportunities fully mature.
Key Arguments: Subsector expertise creates an informational and sourcing advantage, especially in regulated industries like insurance and healthcare. Founder-backed businesses are central to FlexPoint’s strategy because trust and alignment matter more than pure financial engineering. Tiger Risk’s capital advisory capability differentiated it from the larger brokers by giving clients a broader, more strategic relationship. The original investment thesis was validated by market disruption, especially the Aon-Willis combination and the resulting talent movement. COVID increased risk materially, but the team preserved the deal by changing structure rather than simply lowering price. Culture can be a competitive advantage when paired with equity participation and profit sharing, especially in human-capital-intensive businesses. The business scaled faster than expected because the market opportunity, recruiting pitch, and operating infrastructure all came together. Selling to Howden made sense because it was both financially attractive and culturally compatible, unlike a sale to a large global broker. Relationships developed over many years can turn into commercial opportunities and help manage crises when conditions deteriorate.
Data Points: Middle market business count: Around 200,000 - U.S. businesses in the middle market size range mentioned in the intro Middle market revenue range: $25 million to $1 billion - General definition of middle market businesses Middle market workforce share: 50 million people / almost one-third of U.S. workforce - Scale of middle market employment Private equity deal value share: Two-thirds - Middle market share of total U.S. private equity deal value FlexPoint Ford AUM: $7.5 billion - Firm size as described by Ted FlexPoint founding year: 2005 - When the firm was founded Tiger Risk founding year: 2008 - When Rod Fox and Jim Standard started the business Tiger Risk market position: 4th largest - Tiger Risk’s rank among reinsurance brokers globally Tiger Risk business mix: 15% to 20% - Approximate share of capital advisory within the overall business Reinsurance brokerage share of business: ~85% - Ackerman contrasted recurring brokerage revenue with advisory revenue FlexPoint founder-backed investments: 75% to 80% - Share of investments that are founder-backed / first institutional capital Deal timeline: 5 to 6 years in the making - Length of the relationship and process before closing Initial investment timing: End of 2019 / February 2020 - When the final transaction terms were negotiated and the LOI signed COVID conference impact: 60% to 70% - Estimated share of clients who got COVID after the ski conference Debt portion of capital structure: 35% to 40% - Debt was an essential funding component that disappeared during the panic Seller note financing later replaced: About 70% - Portion of seller note later financed with third-party debt Headcount growth: 50% - Increase in headcount after the acquisition Brokers recruited in first two years: About 55 - Number of brokers brought into Tiger Risk early in ownership Revenue growth: Nearly doubled in two years - Business performance after ownership began EBITDA growth: More than doubled in two years - Profitability improvement under FlexPoint ownership Original hold period: 2+ years after regulatory approval - Actual hold period before sale Typical hold period: 5 to 7 years - How long FlexPoint usually owns businesses Post-sale hiring: 30 to 50 brokers - Additional brokers hired after the sale to Howden
Pivotal Quotes: "“deals beget deals”" — Chris Ackerman: Explaining how prior operating relationships and existing investments create new transaction opportunities "“let’s use culture as a competitive advantage”" — Rod Fox (as quoted by Chris Ackerman): Describing Tiger Risk’s recruiting and operating philosophy "“Don’t underestimate the value of culture.”" — Chris Ackerman: Summarizing one of the main lessons from the investment
Implications: The episode shows that relationship depth, culture, and talent mobility can matter as much as financial structure in private equity. In specialized services, the right platform can scale quickly and exit early at a premium if market timing and strategic fit align.
About Private Equity Deals
Allocator and asset management expert, Ted Seides, conducts in-depth interviews with interviews with top institutional money managers across private markets. Guests include principals and senior leaders from private equity, private credit, real assets, and other alternatives. We dive deep into individual deals to learn about deal dynamics, companies, and ownership that make private equity a force in institutional portfolios and the global economy. Learn more and join our community at capitalallocators.com.