Unnamed Analyst's questions to Kingsway Financial Services Inc (KFS) leadership • Q1 2025
Question
An analyst asked for an explanation of the 'J curve of search' concept and its impact on Kingsway's operating companies.
Answer
Executive John Fitzgerald described the 'J curve' as having two components. First, it represents the initial dip in profitability post-acquisition as a new operator invests in talent and technology to enable growth. Second, it reflects the operator's own learning curve, where a high-attribute operator's performance eventually surpasses that of a more experienced one after 2-3 years. He cited DDI, SNS, and Image Solutions as businesses currently on this curve, requiring patience for value creation.