CCC Information Services Inc.www.cccis.com
|Investment date||April 2017|
CCC Information Services Inc. (“CCC”) is the leading provider of automotive collision software solutions and workflow tools in the United States. CCC serves as the backbone of the auto claims ecosystem that includes insurance carriers, auto manufacturers, collision repairers and part suppliers.
CCC offers market leading estimatics, valuation, and workflow software solutions and works with over 24,000 repair facilities and more than 350 insurance companies to process a majority of all U.S. auto repair estimates .
THE INNOVATION ADVANTAGE
Across the hundreds of technology companies that Advent evaluates, the deal team was impressed by CCC’s product innovation, competitive position, and opportunities for growth.
CCC’s management team creates a culture of innovation and works with its customers to create best in class products. The company boasts a talented roster of senior executives to foster this innovative culture. Chairman and CEO Githesh Ramamurthy brought decades of leadership experience, a customer-centric focus and a visionary approach to new product development.
By closely listening to its customers, CCC’s products are highly differentiated and become deeply embedded into customer workflows. The business has established itself as a leader in hyperscale cloud computing, photo analytics and mobile, all areas that are becoming an increasingly important to the industries that CCC services. “CCC does an incredible job investing in new products that it can cross-sell into its existing customer base,” says Eric Wei, a Managing Director in Advent’s San Francisco Bay area office. Such technologies have been transformational to the efficiency and efficacy of auto insurance and repair shop markets, and CCC is at the forefront of offering these technologies through an integrated platform of solutions.
Most recently, CCC’s photo analytics software has gained strong traction among insurance carriers. The product allows insurance carriers to assess and estimate accident damage through mobile phone images; CCC’s machine learning technology will instantaneously create a repair estimate or determine if the car is a total loss.
These product investments, coupled with a loyal, highly satisfied customer base and significant data assets, provide CCC with a powerful and sustainable competitive position. “As we researched CCC’s market position, it was clear that the company had built an incredible moat around its business,” says Wei.
TAKING ACTION FOR LONG-TERM GROWTH
Since its acquisition, Advent has supported CCC in the implementation of an ambitious value creation plan (VCP) across multiple growth opportunities, including new product cross-sell, geographic expansion and customer acquisition. This has resulted in ongoing competitive wins from insurance carriers in its core business and the addition of repair shops to its customer ecosystem.
Within the existing customer base, CCC pursues growth by cross-selling new products. For example, the company has signed up several insurers to its CCC X connected data exchange telematics platform. CCC X aggregates and normalizes data from multiple sources including beacons, dongles, mobile applications and connected cars, which provides insurers with the ability to sell usage-based policies and identify when an enrolled vehicle may have been in an accident. CCC X can automatically share that information with the insurer to initiate a claims process, drastically reducing existing communication inefficiencies between car owners and insurers.
Further, under Advent’s ownership, CCC has entered the auto parts business with a national rollout of a marketplace called CCC Parts, an online marketplace that provides auto repair shops with a streamlined, seamless way to buy parts from OEM dealers and aftermarket parts suppliers.
In October 2017, CCC announced that American Honda Motor Co., Inc. had chosen CCC Parts as its collision parts e-commerce solution. In-market testing of CCC Parts at Honda and Acura dealerships provided a strong increase in sales of OE collision parts, providing proof points to product efficacy and value.
CCC continues to maintain strong momentum enrolling OEM dealers on CCC Parts. In pilot and early rollout stages, the revenue generated by CCC Parts has surpassed the expectations of OEM partners, providing a promising avenue for incremental growth.
In addition to growth within CCC’s core U.S. market, Advent’s VCP includes expansion into overseas markets to facilitate new customer acquisition. In China, CCC has already made significant headway, processing millions of Chinese auto claims and signing up several of the largest auto insurance carriers. Advent team members at local offices in Shanghai and Hong Kong have leveraged their deep local knowledge and connections facilitate introductions and continue expanding CCC’s presence abroad.
“We have worked with multiple private equity investors over the years, but what Advent brings to the table is tremendous capability, hard work, humility, and depth of understanding,” says Githesh Ramamurthy, Chairman & CEO at CCC. “I could not be more pleased with our relationship with Advent.”