An entrepreneur by nature, Mark Nagelvoort has always bet big on F&I. As the president and CEO of Chicago-based PCMI Corp., he wages an ongoing effort to provide technology to help automate processes for administrators and insurers. P&A caught up with Nagelvoort to ask how he got his start, where the industry is headed, and why the ability to provide around-the-clock service is the secret to his company’s success.
Mark, are you originally from Chicago?
Yes, I grew up on the South Side of Chicago and earned my BS and MS in math and computer science from Northern Illinois University. I started my first company, NAT Inc., at 23. And ever since then, I’ve always had an office in Chicago.
You started your first company at 23?
I did. My inspiration derived from when I was a consultant in the advanced practices of a Big 6 accounting firm, which I joined right out of college. My first major client was an insurance company in Chicago who was the insurer for American Warranty Corp., an F&I administrator. They were an early pioneer in this space, which really piqued my interest. I wound up spending seven years with that one customer.
Along the way, I had the opportunity to meet many third-party administrators and agents, which resulted in learning the ins and outs of their business. I realized there was a tremendous opportunity to automate and streamline the full lifecycle of a TPA’s administration processes. That is why I started NAT Inc. in 1980.
At NAT, we built out some great administration system capabilities. We actually built the SCS Auto platform, which was later acquired by Dealertrack. I stayed on as president of the NAT division of aftermarket services for a couple years, then left. Dealertrack kept most of what we built but spun off the administration system.
Why leave Dealertrack?
I’m an entrepreneur. I’ve always been passionate about the dealer space and using technology to improve administration, so while I waited for my noncompete to expire, I was constantly evaluating the marketplace.
Then, in 2012, I saw an opportunity to reenter the space with our new and improved platform, Policy Claim and Reporting Solutions. I brought along two key players from NAT Inc. — Greg Kasprzycki as COO and Eduard Zilberg as lead developer — who are experts in the industry. Since they developed our original platform, we learned from the limitations of that system and used that to form a vision for the PCRS system that would set us apart from our existing competitors. It gave us the opportunity to do everything we didn’t get to do the first time around.
What’s a good example?
One of the main limitations we identified was that large customers, like OEMs and big administrators, wanted to implement a system in phases. Also, we knew that everyone already had a packaged or in-house platform, so we created a modular system. This modular approach allowed customers to utilize each module individually to enhance their current systems or phase out a legacy system, as well as to implement all at once as a complete solution. For example, we can take our reinsurance module and attach it to any administration platform to help get additional revenue.
We also don’t believe in a “one-size-fits-all” solution. That is why our tagline is “Your Technology Partner.” We see ourselves as more than just your software provider. We really take the time, energy, and effort to customize our system in order to meet our clients’ needs and understand their business. We have a real passion and commitment to technology.
Sounds like an easy sell.
It is. We’ve been able to attract some of the leading players in the space. Our system has helped so many different types of companies from major corporations to small companies. We even have clients that are comprised of just four employees. They’re just starting out and need something that’s prebuilt, so they can get products out in a 90-day window without hiring more personnel.
We designed our system to empower our customers and give them the ability to build and define their own products without even talking to PCMI. Since customer buying habits are constantly changing, it is imperative for F&I administers to configure and launch new products rapidly in a system that automates the full lifecycle of their products. Our system can do this and help improve dealer relations and customer experience by our focus on dealer participation programs such as reinsurance, to give more visibility into their financial reporting. We also have tools that focus on accounting, billing, reporting, automation of claims, and integration to 70-plus industry platform partners.
Any challenges along the way?
Well, we didn’t expect to grow so quickly. With growth comes hiring. The company started with just me, Greg, and Eduard and has now grown to 98 staff members in our Chicago, Europe, and Asia offices. The biggest strength we have at PCMI is our people and the extensive experience and knowledge they have of the industry, which allows us to understand our clients’ needs. One of the most rewarding parts of this growth is being able to watch my staff learn and grow, not only professionally, but personally as well.
Why open more than one office?
We believe that our global presence in the U.S., Europe, and Asia is essential to our continuous around-the-clock innovation and customer support. So, at the end of our day in Chicago, a team member in Asia can pick right up on a project, pass it along to Europe, and it’s completed by the time we come back in the next morning. We are literally working around the clock to meet our clients’ needs much faster.
We also have customers who are growing internationally. We have a large penetration in the U.S. and Canada and we recently launched our software in Brazil. We knew that having offices on different continents would allow us to provide support for customers who wanted to expand globally. This was also one of the things we decided from the start, to be able to support our clients in any language, with any currency, for any product.
We look forward to helping our customers explore new markets both domestically and globally.
How do you ensure your software is running smoothly?
We decided to take advantage of SaaS cloud technology and partnered with Rackspace, the leader in managed hosting services. They built us a customized system infrastructure, which receives 24/7 white-glove datacenter support from their team of experts. This allows our team to focus on continually enhancing PCRS while giving our customers what they want — speed and reliability.
What will the near future bring?
It’s an extremely exciting time and there is a lot of opportunity for the industry. We will continue to see that F&I products are essential for retaining customers and building out the dealership experience. It’s clear that people in the U.S. and around the world are going to be shopping for cars online. Making sure F&I products are properly presented is vital and as an industry, I think we need to focus on getting F&I earlier in our process to provide customer with all they need from the start. So the industry expectations overall are only going to increase, and technology is going to become more and more important.
We are constantly aligning our development efforts to keep up with these changes. We’ve expanded our offering to now include Platform as a Service, which means you can write your own applications on top of our software or extend our platform beyond what we envisioned. For example, one client decided they wanted to insert credit life into PCRS. Others want to create smartphone apps for claims. We also have APIs that allow you to connect with other platforms that are driving the industry. These are the types of things we invest in to make sure we are always staying up-to-date and being innovative.
Has the challenge been worth it?
Absolutely. I owe a lot of this to my wife, who truly understands me. Back in 2012 when my noncompete expired, she said, “You need to get the team back together and start again. Then you’ll be happy.” It was a challenge to come back and open three offices without a single customer and it was a massive personal financial risk. But I realized we had to do something great or it just wouldn’t work. So I’m grateful to my wife, those customers who trusted us in those early years, and to our team who made it all happen. I’m just trying every day to build an organization they can all be proud of.