| Chasing the independent dream with a loyal team and a new technology
The title insurance industry and all of its long-standing traditions and ideals are in his blood. Michael Tafoya's father, Jim Tafoya, worked in the title insurance business for more than 40 years, 30 of which were spent at Stewart Title. He worked his way to president of Stewart's Los Angeles office, and of course, Michael worked at the office growing up. Born into the business, he says.
 “It was my dad giving me a summer job, working in the customer service end,” Michael said. “When I got to college, I started to enjoy what I did.”
Michael, now chief executive officer of Title365, started like anyone else: Reading dusty old training books, walking down to the recorder’s office, typing on typewriters stuffed with carbon paper. And so on. Those are the tasks that build a title professional, and Michael cherishes that foundation, but he also never believed those tasks would define the industry.
“In the late ’80s, early ’90s, you could see the vision of how technology was going to change things,” he said. “Some of the changes were easy to see, but interacting with clients and building information and the transformation of data were the pieces that could change this industry.”
Shortly after Michael started at Stewart, Jim suffered several strokes and retired from the business, later passing away. He was 63. The family bond that brought Michael into the title industry, and Stewart specifically, was now gone, and the time was right to forge a new path. He was wooed away by an independent title company and entered the sales side of the business for the first time.
“That was an exciting time — going out, doing something new, meeting with clients and looking at the other side of the industry. I liked interacting with the clients. Being out there and actually helping them grow their business was probably the greatest thing. It helped to have that early experience to really know what was going on in the back of the house.”
His next stop was at United Title in Orange County, Calif. This was 1997. This was when he met “the Peters.” This is when it starts to click — but we’ll get back to that.
Michael was impressed with the technology platform at United. “I was coming out of one of the bigs, and the technology was so far beyond what anyone else had built that it really stretched the imagination; we were so far ahead of the game that it was an easy sale for me.”
As things often go in the title industry, United was sold, and then it merged with another company, Capital Title, which was then sold to LandAmerica in 2006. Michael was along for the ride during all of those moves, and he entered LandAmerica as part of the executive leadership team reporting to Virginia.
Bigger role, expanded environment, many would find it to be a career highlight. The publicly traded world isn’t for everyone though, and Michael quickly realized that what he really liked about the title insurance business, during his career, was the time spent being an entrepreneur. He couldn’t let go of that feeling. Staying in the LandAmerica position, as a cog in the wheel, just didn’t feel right, especially after more than a decade of working with a technology platform that he and his team believed could revolutionize the way title business was done.
“United is where we really grew up and realized the power of the technology [we built], and how we could change the industry. We grew it in a three-year period of time to one of the top independent companies in California. We went from the No. 20 spot to No. 4 or 5 in a matter of three years. Because of the technology we had, we could attract talent. It was a game changer for us.”
LandAmerica certainly took notice, but LandAmerica had just incorporated their technology into its network of 386 operating systems, accumulated after years of company acquisitions. Not being able to bring the United technology companywide was a deciding factor in the drive to leave LandAmerica and do it all again.
“I left there probably three weeks before it merged into Fidelity. We left because we like being entrepreneurs. It was one of those great opportunities where we said lets go find our own license and build again. Not only have we been thinking of all these changes we could build into the technology and grow it even further, we really wanted to grow a company that wasn’t publicly traded. … Those were some rough times. We wanted to make sure everyone enjoyed going to work every day.”
 “Probably meeting with the Peters for the first time,” Michael said was the moment it all started to click for him. This was in 1997. This was at United. The Peters is shorthand for Peter Derbonne, Peter Richter and Peter Bowman. The Peters are important to Michael’s story. It’s almost impossible to write one without them, and this isn’t lost on Michael because any question asked about the business, or his thoughts on the industry, will always include a reference to one or all of the Peters.
“Since 1997, we’ve all been together. There’s been a few times when somebody ventured out, but we’ve all come back. We are so complementary to each other; we all come with a different set of skills,” Michael said.
The scouting report: Co-chief information officers and senior vice presidents Bowman and Richter are left brain and right brain of the technology of Title365. One is great with software development, graphics, and a marketing sensibility and the other is more responsible for systems, integration and workflow. Bowman and Richter were also classmates in college. President and chief operating officer Derbonne takes the lead on sales. Michael’s role is that of director and motivator, he says, almost downplaying his contribution to the continued growth and fulfillment of vision after taking that leap from LandAmerica.
“Any one of us could lead this company because we all share the exact same vision, and we can all articulate that vision as well as the other,” he said.
They are a cohort, Michael’s new family bond within the industry, and this foursome is at the heart of Title365. Upon leaving Land America, the group purchased the California title license of Advantage Title and started to build from there with its Title365 technology platform as the backbone. As the company started to expand, it became clear a re-brand would be necessary because each new state they moved into seemed to have an Advantage Title already. It made sense to just change the company name to Title365.
“We liked it so much, and everyone already thought we were Title365, that for branding purposes we renamed to Title365 throughout our footprint,” Michael said.
The company is underwritten by Old Republic, First American, Westcor and Fidelity, is now licensed in 36 states and is near licensure in another seven. It has feet on the street in eight states and plans on being in every major city within the next five years, with the technology platform, more so than anything else, being the main driver. Growth has been fairly organic, but Michael isn’t opposed to acquisition, if it makes sense.
“Looking further down the road, we thought if we acquired someone and they had a strong name, we may want to keep that name but put them on the platform,” Michael said. “In most cases, title companies are built on the people. We consider ourselves high tech, high touch; we still think sales people and ownership and relationships drive this business, but that technology is the intertwining piece that keeps them all glued together. If we were to acquire someone we’d probably underbrand it Title 365, and that company could then leverage that in part of their own branding.”
Strategically, Michael said Title365 has to keep the number of states in its footprint growing in order to grab more of the national lender business. This is where the fifth Beatle, Eric Swenson, comes into play. Swenson was named chairman of the board this year, coming to the company from Fidelity and LPS, and his national connections are invaluable to the company’s next steps.
Michael makes a lot of bold claims about changing the industry with Title365. The point of emphasis for the platform is the collaborative, transparent portal it provides all parties to the transaction, even the consumer.
“It’s the greatest communication tool in the industry,” Michael boldly states again. “It allows for our internal staff to communicate without picking up the phone. It allows for complete transparency throughout the transaction, and it goes all the way down to the consumer. Bringing everyone into the process, with complete transparency, from our lenders to the real estate agents to the consumers, they love the involvement in the transaction.”
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“The industry is changing ever so slowly. We still today ask the question 'why are we doing this, this way?' Sometimes we never get a response, and we realize it's because that's the way it's been done for 60 years, and we're trying to change those paradigms.”
Michael Tafoya
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Title365 actually goes out of its way to educate and communicate with the consumer. The Title Report went in-depth on the software last year, and if you’re interested on the inner workings, definitely take a look at that. Michael makes sure to say they are not done adding new features, not by a long shot. The piece he’s most excited about now is the integration of personal app/text messaging services in order to provide updates and steady communication.
“We’ve done it in a fun way, bringing in the consumer and introducing them to title. It’s a fun little add-on for our company,” he said. “Consumers definitely are asking more questions because we are empowering them; we are taking a proactive role and getting them involved in the transaction, always giving them access to the information that’s going on. It’s been overwhelming how great the response has been on it.”
You get the idea Michael and the team aren’t just trying this to be different — they really believe this is the future for the industry. In fact, they are so confident of this vision for the future, and the role Title365 could play in that, they split the technology piece into its own separate company, X1 Labs, in order to license the technology outside of their actual footprint. The first two beta clients are currently up and using it.
“The industry is changing ever so slowly,” Michael said. “We still today ask the question ‘why are we doing this, this way?’ Sometimes we never get a response, and we realize it’s because that’s the way it’s been done for 60 years, and we’re trying to change those paradigms.”
 Title365, or some facsimile, really might be the future, but as is usually the case, the future is a ways off. In the meantime, you can find Michael in an airplane, either headed out to Texas, Florida, Arizona, Las Vegas or Northern California to open a new office or mentor a current one.
“I think it’s constantly reassuring them of our vision, and how we are growing, that’s the best part of my job,” he said.
After all that, it’s time to put the revolutionary communication platforms away for a moment and head to a secluded riverbank some place in Northern California or Montana or Wyoming, to drop a line the old fashioned way — into the water to catch a fish. The one paradigm Michael will allow to remain unchanged.
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