The New Entrepreneurship: Personal Holding Companies & Multipreneurship

I have a good friend who has been a very successful entrepreneur. He started and sold a few companies in his past but in the last decade or so changed his mode of operations. He would start companies but then turn them over to sharp, hungry 20-30 somethings to run. 

He would become a minority shareholder, act as coach, and leverage his experience in the background, while the younger entrepreneur would manage the day to day. While some of these are software businesses, most tend to be service agency type businesses focusing on specific niches, leveraging overseas talent while servicing 1st world country clients  but drive massive cash flow. He has accumulated an estimated 9-10 of these kinds of businesses. And built a crazy good lifestyle to boot. 

I’ve noticed a phenomenon of a new style of entrepreneurship. Andrew Wilkinson, Nick Huber, Sahil Bloom, Greg Isenberg. It’s actually Greg Isenberg who coined the phrase “Personal Holding Co” aka PHC which is a thesis-driven holding company not necessarily designed to sell businesses but to cash flow them. Or in his own words: “A PHC is basically one registered entity, building multiple products, multiple revenue streams, multiple investments versus the classic 1 startup = 1 product.”

You basically productize yourself and make a bunch of bets against a thesis you are interested in, some will be minority shareholdings, some will be a majority shareholder. And you can leverage the cash flows from this to invest into new businesses. I’d also add that Nick, Sahil and Greg really leveraged their personal brands and built huge online distribution power on social media and X aka Twitter. 

You can build or buy companies under this PHC. Sahil Bloom builds, he thinks of problems like Amazon Web Services. How do you change a cost structure to a profit center? He realized he needed good video creation service as well as good animated graphics. Other creators soon reached out to him and he partnered with an experienced agency friend to build out businesses around these. 

Nick Huber actually talks about this in an interview here: https://www.youtube.com/watch?v=9g6ErC0O9g0&t=819s. He says: 

“The same way I will be buying businesses is how I will start them. Looking at my cost centers, my profit and loss statement and where I am spending money. The interesting part is if you look at the 10 businesses I started, 8 of them were businesses I was spending money on at Bolt storage. Property and casualty insurance, Debt brokerage, Cost Segs, SEO link building, performance marketing, website development, recruiting. All these things were things I needed as a business owner.

And it turns out that a lot of other business owners who follow me on Twitter for the management advice and trust me because they listen to my words, they read my newsletter, they listen to my podcast, whatever it might be, they will need the same things I would need.” 

It’s really smart because you get different streams of income and diversification, while getting economies of scale and turning costs into profits via a new business. 

It will be more prevalent in the creator economy and these PCH will be made up  of service agencies, niche software to DTC (Direct to Consumer)/ ecommerce businesses & media content businesses like YouTube or Newsletters. All usually built around a personal brand or niche audience. It just makes sense and empires will be built this way. 

I really think an important vehicle of entrepreneurship will be these Personal Holding Companies. It’s a good structure to unify and run different lines of business.