Broadlands Financial Group

Kenneth Brier and Ted Drauschak met at a Marriott Corporation employee New Year’s Eve Party. They immediately discovered a shared passion for construction and real estate development and agreed to have lunch two weeks later. At that lunch Ken Brier asked Ted Drauschak to partner with him on a consulting contract Ken’s company had with a company in Marina Del Ray, California called XSIRIUS, Inc. Ted agreed, and shortly after they began a partnership that has lasted two decades, the first two of which were spent in Ken’s basement preparing the company for operations. That is how Broadlands parent company was born.

Eventually, the vision and efforts of these two entrepreneurs and efforts and they emerged from the basement on September 11, 1992 when they leased 750 square feet of office space, thankfully above ground, in Bala Cynwyd, Pennsylvania. They remained in that building, eventually leasing 7,500 square feet, until September 1, 2006 when they moved into 17,000 square feet of office space in Villanova, Pennsylvania. Kenneth Brier is Chief Executive Officer and President of Sealord, and Ted A. Drauschak is Executive Vice President of Sealord and President of Broadlands.

Broadlands parent company was founded in 1991 to issue contract surety bonds in the small to medium sized niche of the contract surety marketplace and to provide a high level of customer service through the application of financial underwriting and construction risk management solutions. Brier and Drauschak had broad experience in the real estate development, construction and engineering industries. Both Brier and Drauschak had occasion to use surety bonds for projects they managed and each realized that it was somewhat difficult for small to medium-sized contractors to obtain surety bonds from large bonding companies. In addition, the bonding companies that issued surety bonds did not always provide a high level of customer service to the contractors.

Because of their development and construction experience, Brier and Drauschak realized that the inherent risk associated with the surety product must be offset by proactive risk management processes that pinpoint and eliminate construction risk. As such, the two entrepreneurs designed an internal risk management and loss control division of engineers, attorneys, project managers and project finance professionals. This diverse professional unit supported the traditional surety underwriting process, primarily a function of financial condition, with real construction analysis of the risk associated with the scope of work and contractor capability. In addition, this division of construction loss control experts controlled project funds to ensure proper cash disbursement and provided default analysis and takeover and completion expertise in the event of contractor termination.

In September 1994, the company completed an initial public offering at $5.00 per share in order to raise additional capital. The company’s investment in proactive construction risk management was unique to the surety industry and the company achieved many successes including loss ratios well below average industry standards. As a result, Brier and Drauschak were approached by several potential acquirers. In August 1998, a subsidiary of Zurich Financial Services Group purchased the company for $42.5 million in cash ($14.60 per share).

The company continued to perform well under the Zurich umbrella. In 2002, Zurich began a strategic reorganization effort aimed to return the company to its core life and non-life related insurance enterprise. As a result, the senior management was presented with yet another entrepreneurial opportunity to repurchase the company and they took full advantage. The management-led buyout was completed in April 2003.

The company currently operates through two core enterprises: Broadlands Financial Group, LLC; and First Sealord Surety, Inc. Joining Brier and Drauschak are two additional managing partners: Joel Cooperman, the enterprise CFO, and Bryan Fortay, Executive Vice President, who oversees Broadlands Financial Group’s international operations. In addition, the company has three outside investors including: the former CFO of Zurich worldwide and former CEO of UBS North America; the former CEO of Zurich Scudder Investments; and the Director of Global Equities at Lazard Ltd.