Several aspects of this deal stand out. It is the first acquisition by Guidewire, which until now has been a “we build it, we sell it shop;” it augments Guidewire’s capabilities in the hottest part of the technology landscape (business intelligence/analytics); and, it reinforces Guidewire’s strategy to capture the community and network effect benefits of its large customer base.
Of course, Guidewire will not be alone in offering BI/analytics to its core systems customers. Nearly every major property/casualty software provider offers its own BI/analytics functionality and/or partners with third-party providers. Cover-All’s 2010 acquisition of Moore Stephens Business Solutions is also an interesting precedent.
Here are three questions to keep in mind moving forward: Will Millbrook give Guidewire a competitive edge in vendor selections? Will other core systems vendors begin eyeing the remaining BI/analytics firms? And what kinds of insurers will want to one-stop shop for core systems and BI/analytics?
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Donald Light is a senior analyst in Celent's insurance practice, and can be reached at dlight@celent.com.
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