Consolidation is sometimes a threat to a network built on independent brokers, according to José Manuel Dias da Fonseca, chairman and chief executive of Brokerslink and global chief executive of Portuguese broker MDS Group.
“Some brokers disappear, just disappear, they are swallowed,” he said.
The network has been raising capital from its own members. A second private placement, open only to members, closed in June. It took the number of shareholders from the 50s to almost 70, and the network has since expanded its board from eight to 10 directors, as three new directors joined and Sunny Leons stepped down after twelve years.
Fonseca said new members wanted to become shareholders and existing investors followed on. He said members putting in their own money matters because “it means much more alignment”. The capital is going into communications, technology and staff, and he said a third placement is not forecast for now.
The three new directors are from member brokers in Hungary, Morocco and Belgium. Fonseca said the three brokers are important investors in the network. “All the board members are investors,” he said.
In almost every market, the network has one retail broker per country, with two or three exceptions for historical reasons. It has retail brokers in 141 countries and no UK, US or French hub. Alongside its retail members, its ecosystem of 174 companies includes specialist brokers in areas such as cyber, event cancellation and sports, as well as firms in claims and risk consulting.
Fonseca said the network does not really compete with the largest global brokers, but can offer multinational clients an alternative. Some clients work with a local broker and use the network for their international business. He said there were many such cases but did not give client numbers.
The network’s UK member was previously Bridge Insurance Brokers, which Gallagher acquired in April. Since July, Everywhen Corporate & International has been Brokerslink’s exclusive representative broker in the UK, bringing retail insurance and employee benefits together as a Brokerslink Affiliate.
The Ardonagh Group, which owns Price Forbes, is a shareholder and is represented on the board by James Kalbassi, executive chair of Price Forbes. Fonseca said the board changes bring no particular change for UK members.
He said the UK market matters to the network because it both sends and receives large volumes of international business. With one retail broker in almost every market, Gallagher’s acquisition of Bridge shows how quickly consolidation can change who represents an independent network in a country.
