We're going to be more efficient. I am not afraid of AI at all.
Today, my guest is chairman and CEO of Arthur J. Gallagher, Pat Gallagher. Pat, great to see you today.
Thanks, Al. Great to be with you.
I'm very happy. I was very excited to do this with you. We have a long history in this business together.
Not to age ourselves, but I think I started this business shortly after you guys went public, I think, which was probably like the early to mid '80s, if I'm not mistaken.
We raised a whopping $11 million, and we finished the year with a $79 million market cap.
Unbelievable, right? Boy, have things changed. And look where you are today. You've built one of the premier companies worldwide here. Fantastic job, and which always has... I've been real interested in, it always was intriguing to me how you kept that entrepreneurial spirit while doing it, that insurance brokerage-type mentality with family business. All the generations you've gone through, it's been amazing, Pat, to watch what you've done. And certainly, no one could deny the great business that you've built.
Well, thank you, Al. You're very kind. It's been a huge team effort from the very beginning. Blessed by having great mentors my whole life, my uncle and my dad included in that, and just being in the greatest business on the planet. I say that to our interns every summer. Take a look at this business. Half of them have never even learned how to spell insurance, and it's like, 'Guys, gals, this is the best business on the planet.'
Right. I always say high margin, residuals, need the product by law, at least most of them. And it's probably the best-kept secret that young people don't get into as much anymore, and more should, because it's a fantastic business, and I fell into it. I wasn't expecting to be into it. I actually still hold my insurance licenses, which most people don't know, because I started with Liberty Mutual out of college and was frustrated with them. And I ended up going back to the headhunter who got me the job, and he said, 'Why don't you do this?' And certainly, I started doing it from the headhunting side and got to know folks like you, and then it became the M&A stuff and built a pretty good business ourselves over here in the last 38 years. Okay?
Well, you take a look at our industry, Al, one of the things I think people don't recognize is they don't recognize the size. So this is a $7 trillion premium business globally. And that's Swiss Re numbers. And then you look at that, and you realize the impact that we have on society and spreading risk. And look at things like the Gulf War coming up now and the value that insurance is adding to that whole dilemma. And then you realize how competitive and fun the business is, and then it's rewarding. People make a good living. And at the end of every single product we sell, everything we sell through our and for our clients, basically puts people's lives back together. That's a pretty noble profession.
100%. It's a great industry. I'm so fortunate to be into it, not directly selling the stuff, but working with folks like you and being able to build a business on the other side of the ball that's been very, very successful. Pat, I got to get this out of the way because you taught me one thing that I live by, okay? And everyone will tell you that works with me. A long time ago when we talked, and you probably don't remember it, but I was talking to you one day, and you always answer your phone, which is amazing. Most guys at your level, they have five assistants answer their phone till they get to you and whatnot. But you always answered your phone. You picked up the phone, we were talking about a deal, and you said, 'Al, the only time we screw these things up is when we pick the wrong people.'
And I've taken that and adopted it, and my whole slogan now is 'People buy people.' Right? They don't buy businesses. And I adopted that from you. I'm giving you all the credit. I piggybacked off of that one statement you made to me years ago. And I don't want to age myself, too. I'm a young 64, okay? But that was something that stuck with me, and that's something we use when we market, and we talk to our clients that they need to understand that people aren't just buying your business, they're buying you. And that's where you've been so successful.
And you call these... I think you use the term partnerships. You're not using acquisitions. And man, when you look at your business, what you've done, it's been amazing, Pat. It's just top of the class, first class, not just yourself, but all your people, just a load of good people that you've brought on, and that's because you focused on the people, right? First.
Al, thank you. You're right. And that's the key to the whole thing. That's it in a nutshell. You're exactly right. Thank you.
So, Pat, lots going on in the market these days, and that's constant, right? And I've been through many, many cycles of it. Not just the soft market. I'm not talking about which we're experiencing now from an insurance side, but obviously the M&A market, the global markets, all the different things that are going on out there that potentially affect insurance brokerage, which really is recession-proof anyway, in my opinion. Because people want to invest in this business no matter what because of those factors, the residual factor, the high margin, okay? The bottom line here is some things have changed, including the opportunity for some folks like Gallagher, who have just done a couple significant transactions. So congratulations on Woodruff Sawyer, Assured Partners. Those are marquee names, right? And only high-quality firms like Gallagher could absorb them and integrate them, which we know is the biggest challenge, right? That's out there all the time, integrating people. Where does Gallagher sit today? The strategy, has it kind of continues to evolve? You keep your same core principles, I know that, because you live by that, which is very amicable. But how do you see the current state of Gallagher and the future and what you think the opportunities are out there? There's been a little bit of turmoil now recently with AI and all this stuff. Where do you see you sit right now?
