Key Learnings
- You should aim to become industry OS building products and monetising from multiple stakeholders in your vertical. CCC serves all the stakeholders involved in the auto insurance industry. Insurers (50% of revenues) and car repair shops (43% of revenues) are the most obvious stakeholders but CCC also connects them to other parties like OEMs, parts suppliers, recyclers or lenders.
- You should constantly expand your TAM as a vSol. CCC is leveraging multiple growth levers to expand its TAM: (i) going from one to multiple products for insurers and car repair shops, (ii) selling to multiple stakeholders in the auto insurance industry, (iii) combining business model dynamics from SaaS, financial services and marketplaces, (iv) expanding beyond the United States staring with China, (v) looking to expand in other insurance segments beyond auto-insurance.
- You can pretend to reach a high market share as a vSol. On the insurance side, CCS works with 300 out of the 1k auto insurance companies in the US (30% market share) and with 27 out of the 30 largest ones (90% market share) which are generating 85% of auto insurance premium. On the auto repair shop side, CCC works with 29k collision auto repair shops out of the 40k in the US (73% market share).
- You should not limit yourself to a single business model as a vSol. The best vSol are able to combine multiple business models dynamics and revenue streams. CCC manages to combine SaaS (SaaS for insurers & auto-repair shops), financial services (payments processing between insurers and auto-repair shops) and marketplaces (parts marketplace) in the same platform.
- You should add network effects to make your vSol more defensible. I previously studied Shopmonkey which is building an all-in-one solution for independent car repair shops. I highlighted competitive intensity as a key risk for the business with the rise of multiple good cloud-based, mobile first and VC-backed but undifferentiated solutions. CCC has a similar product to Shopmonkey for car repair shops but it’s much more defensible because it’s tied to its network of insurers enabling car repair shops to execute repairs for insurers. CCC has a strong defensibility from being the network to process claims between multiple stakeholders in the auto-insurance industry.
- You need a critical mass of customers before embedding payments into a vertical SaaS. CCC was founded in 1980 but only expanded in financial services in 2019. It started a product for lenders to streamline the loan repayment process when a consumer car has been written off by his insurance following an incident. In 2021, it added a payments solution integrated into its broader platform to streamline payments between insurers and car repair shops.
History
Timeline History
Redacted History
CCC was founded in 1980 in Chicago with the vision to digitise the total loss claims process for insurers. In 1992, it pioneered the Direct Repair Programs which connects insurers to auto-repair shops to streamline the repair process following a car accident. It was a crucial moment in CCC’s history enabling the company to position itself at the crossroad of stakeholders in the auto insurance industry and to create network effects.
In 1996, CCC went public for the first time and stayed public until 2006 when it was taken private by Investcorp. Between 2008 and 2012, CCC transitioned its platform from on-premise to the cloud and introduced SaaS as business model. In 2013, Investcorp sold CCC to Leonard Green. In 2017, Advent acquired CCC from TPG and Leonard Green. In Aug. 2021, CCC went public for the second time of its history raising $605m via a SPAC vehicle created by Dragoneer at a $6.5bn valuation.
Product
Solutions for Insurers
It works with 300 insurance companies. It processes 12m claims annually accounting for 85% of claims processed in the US. It has several modules for insurance companies including:
- Workflow: claim processing from customer intake to resolution with the possibility to customise claim processing workflows, to triage claims, to offer modern interfaces to end consumers (e.g. mobile, web portal) and to collaborate with car repair shops on claims management.
- Estimating: auto repair estimating solution with AI-powered inspection and automation features to pre-fill estimates.
- Total loss: handling total loss auto claims from auto value estimation, lender payoff requests management, lien & title resolution.
- Casualty: handling personal injuries from auto accidents processing medical bills & demand packages.