Skyward CEO Robinson: Relationship-building with investors led to successful IPO

Skyward Specialty CEO Andrew Robinson has said the significant amount of time his firm spent building relationships with investors in the run-up to its January 2023 listing played a key role in the unique success of its IPO.

Robinson made those comments in a wide-ranging interview with The Insurer TV, at a time when a significant wave of specialty companies are exploring potential public listings.

Skyward had looked to launch an IPO at least three different times last year, but pressed pause on the process in each instance amid tough equity market conditions.

“If I had to take a single lesson from [our IPO process], all the time and effort that we spent building relationships with investors – which was a byproduct of just awful 2022 [public market conditions] … ended up proving for us to be an immensely valuable set of activities that clearly have benefited us during 2023,” Robinson told The Insurer TV.

Since January, shares in Skyward have soared by more than 73 percent to $33.12 as of Wednesday morning, in contrast to the more modest shareholder reactions to the Fidelis IPO in June and Hamilton’s listing earlier this month.

The strong performance of the shares has led the company to launch a pair of secondary offerings at minimal share price discounts, with the stock trading north of 2x its book value.

Robinson said that an extended “testing the waters” period has now become a much more common path to a listing, and “effectively allowed us to connect with investors in a way that they really understood [us]”.

“So when we took the decision in January 2023 – when nobody was really thinking about getting out an IPO – it really came from a position of confidence … [and] having a confident view that our investors understood who we are, [and] what was unique about our business,” Robinson added.

The Skyward CEO also said his company benefited from taking initial feedback from prospective investors and then taking a number of actions based on that feedback.

“When we ultimately took the company public, we had reflected the feedback from investors in ways that they had not seen from others through the testing of the waters meetings.”

Asked to comment on potential takeaways from Skyward’s listing that others could learn from, Robinson said the company took steps that were “appropriate” for its business specifically.

“Others who are going public I'm sure are understanding their unique circumstances and thinking about that relative to taking their company public,” he explained.

“But the building of relationships, the testing [of] the waters, listening to your investors [and] prospective investors and doing that probably two or three times as compared to what you might ordinarily do is an immensely valuable exercise,” he added.

Robinson called the overall experience of becoming a public company “very, very positive”, saying that the firm has been “incredibly well-received” by investors, which he said is a byproduct of strong performance.

“The first – near first – year has been pretty darn extraordinary and I think by and large everything we would have hoped it to be,” he said.

Still, he acknowledged that being publicly traded is generally more challenging than being privately held, noting that listed companies have their results “on display” every quarter, along with investor expectations to manage.

He also said that as a privately held company it is easier to communicate more directly with investors about a business’s long-term vision.

“We always make our decisions through a lens that's more long term-oriented but certainly, as you're trying to communicate that to public investors, I think that's generally a tougher challenge,” he acknowledged.

Robinson called market conditions “orderly and constructive” and said that posting good results with good growth had contributed to his company’s positive experience in the public markets.

“As the famous philosopher Mike Tyson said, ‘you're not in a fight until you get punched in the face’, well, I don't think we've yet been punched in the face,” he admitted.

“We definitely have an approach to the marketplace, a profile of business, and performance that investors appreciate,” he explained.

Watch Part I of the interview with Skyward’s Andrew Robinson to hear more on:

  • The current phase of the M&A cycle and the role Skyward expects to play
  • Where Robinson sees Skyward in its trajectory to becoming a top-quartile performer
  • Where he sees the insurance cycle and if rates are still keeping up with loss trends
  • Skyward CEO’s view on debates around business moving into the E&S channel

And stay tuned for Part II coming soon, where Skyward’s CEO discusses the implications of AI, along with the state of insurtech, the firm’s interest in the cyber market, and more!