Opinion: Do You Know the Value of Your Data?

Last week, Xactware President Mike Fulton added his name to the list of organizations releasing statements about CoreLogic’s acquisition of Next Gear Solutions. Mr. Fulton ends his open letter to Xactware users with this statement: “We look forward to innovating on your behalf for many years to come.”

From his comments, it appears that Mr. Fulton believes innovation is the biggest concern for Xactware users. 

Readers should recall that “users” includes carriers and contractors. So, is innovation the biggest concern for restorers as it relates to the acquisition of Next Gear Solutions? Doubtful. Is innovation the biggest concern for insurance carriers as it relates to the story? Quite possibly. Is innovation the biggest concern for Xactware as it relates to the story? Clearly. 

For many, all of this has raised questions about data. Before you get too concerned about what others may or may not be doing, you have to ask whether you understand and are leveraging the value of your own data.

Innovation (Who has my data?) 

Is innovation the number one concern of restorers? Before we can answer that on a broader scale, the more pointed question is whether innovation is the primary concern when restorers think about the acquisition of Next Gear Solutions, which includes the 85,000+ users of the popular restoration job management software, DASH. Restoration Industry Association (RIA) President Mark Springer took to Facebook Live with Ed Cross to discuss some concerns over data. Do you know who has your data and what they are doing with it? 

The DASH Enterprise platform includes LuxorCRM Strategic Sales Management, DASH Restoration Business Management, and MICA Mitigation Management Software. These tools have all the data from nearly 8 million jobs and counting according to their website. Upon onboarding Liberty Mutual in late 2020, CoreLogic president and CEO Frank Martell stated that he believed their partnership demonstrated, “Our ability to unite all parts of the insurance supply chain on one cloud-based platform.” 

This sentiment from CoreLogic would indicate that they and Xactware see innovation in the same light, with their platform competing to lead (or own) the market. There are also similarities with regards to the influence of private capital; Xactware is owned by Verisk and CoreLogic by The First American Corporation. While this isn’t different from any other major company in any other industry, it opens a lot of questions as to how important restorers will continue to be as these service providers continue to chase their most attractive (deepest pocket) dance partners. 

Competition (What are they doing with it?)

Another question for restorers is how this deal impacts competition in the industry. Symbility emerged in 2004 as an estimating platform for property insurance claims with some aspirations of becoming a competitor to the widely used Xactimate. CoreLogic has been making a focused effort to diversify its portfolio by targeting the insurance market. As a long-time minority shareholder in and data provider for Symbility, CoreLogic acquired the platform in 2018. Most readers will be aware that in 2006 the predecessor to Verisk, ISO, purchased a family-owned company called Xactware.

Symbility had some inroads with Chubb and Erie Insurance and finally made a noticeable move when it became the estimating tool for Farmers in 2010. This was short lived as Farmers returned to Xactimate in 2014. Competing with Xactimate’s construction cost database is a hurdle for any would-be competitor. As Ben Justesen first noted, Symbility cites The Craftsman Book Company as their third party pricing source. The software company believes provides them a unique advantage in the market as in their white paper, “Users of the Symbility data can be assured the data is not skewed or adversely influenced by large customers or contracts.”

Symbility didn’t have the steam to compete with Xactimate a several years ago, does this infusion of capital and resources position them to try again? While restorers complain about Xactimate, a strong competitor in the estimating process for claims settlement may not ultimately result in better outcomes for contractors and policyholders. With more input from contractors and efforts such as the Advocacy and Government Affairs Committee (AGA) of the RIA, progress is being made and Xactimate has been making adjustments to their system. If an alternative rises into the claims disco, will they push the system towards free market competition or digresses further into a gambol for appeasement to retain market share? 

Collaboration (Do I know the value of my data?) 

Mergers and acquisitions all have the same generic positive language. Next Gear Solutions CEO Garrett Gray said of their deal with CoreLogic, “We will continue to work with all industry participants to ensure secure and customer-directed flow of data, so the market has expanded options.”

We know that convenience comes at a cost, and yet efficiency is a premium service. Having fewer places to enter data, reducing duplication, is an advantage to the restorer, but there are hidden indirect costs? The data is “safe”, but to what end are the holders of the gems using it for? 

In Mike Fulton’s statement, the third paragraph is interesting in light of the recent litigation outcomes with EagleView. Mike says, “Xactware and Verisk believe in vigorous competition in our free enterprise economy.”

In September of 2019, a jury determined that Verisk willfully infringed several patents on aerial imaging owned by partner-turned-rival EagleView Technologies and set damages at $125 million. The veracity of their commitment to competition was called into question as the court noted that Verisk was “driven by a specific animus toward EagleView.” As such, in February of 2021, a judge raised the penalty total to nearly $400 million after finding Verisk in violation of nine Read Factors for enhanced damages

By their definition, CoreLogic “is a leading global property information, analytics and data-enabled solutions provider.” This deal reminds us of what we already know: data is gold. Many restoration contractors still have a lot to learn about how to organize and mobilize their data to their own benefit. Obviously this data is of great value to many organizations within our industry as well as those on the outside (i.e. private equity). If the software you use to compose your estimates is run by the same company you use to track your billing, that organization knows what you charge as well as what you made. Are there any potential conflicts in this equation? 

Be Intentional (What am I doing with it?)

The ever vigilant Michelle Blevins broke this story on Facebook Live and has been tracking the rollout by compiling responses to the news of CoreLogic acquiring Next Gear Solutions, getting feedback from industry partners, and publishing this statement from Xactware. While Mike may have missed the issue on this particular news, in the bigger picture he isn’t wrong. He is telling you what Xaxtware’s focus is and clearly, CoreLogic is pursuing a parallel trajectory. 

Spend the time to be intentional about your business. We should not be driven by fear but we must be educated and continue to work together as an industry.

As Katie Smith said at the 2021 RIA Convention, “There are thousands of contractors, but we don’t have thousands of problems. We all have the same major headaches.” If you are going to innovate you must know how to organize your data. If you are going to compete you must know how to mobilize your data. Big businesses getting bigger isn’t really news. Yet, events like this should challenge the intentional restorer to seek peers and partners who are working on change rather than just complaining about it. 

Jon Isaacson

Jon Isaacson, The Intentional Restorer, is a contractor, author, and host of The DYOJO Podcast. The goal of The DYOJO is to help growth-minded restoration professionals shorten their DANG learning curve for personal and professional development. You can watch The DYOJO Podcast on YouTube on Thursdays at 9am PST or listen on your favorite podcast platform.

Jon recently released, So, You Want To Be A Project Manager? written to help restorers develop the mindset and habits for success with project management. This is the third book in the Be Intentional series. Previous titles address the topics of Insurance Claims Estimating and Workplace Culture.

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