We have done that, there's some efficiency depending on the companies. Just be sure the "parent" (holding company) doesn't have any risk exposure or you can lose them all in a suit.

Your question can be interpreted in a number of ways. The above comment assumes you are asking about creating a "conglomerate" using a holding company to buy and control a number of independent companies. Hanson PLC (for those old enough to remember), MacAndrews & Forbes (Ronald Perlmans vehicle) and Berkshire Hathaway are big famous examples. The question there is always is whether there is value to be created in this manner. However it could also be interpreted as a a query about buy & build which is a common strategy and one I have backed in the past. There is a ton of literature on each of these.

I am currently working to build this. From my HoldCo, Strongpoint Management Group, I currently oversee a service business and a portfolio of 50 apartments (I got my entrepreneurial start in commercial real estate). My plan is to build the business side of this portfolio, both through separate acquisitions and roll-ups with the same locale and industry as my current business. FCF flows into Strongpoint and I allocate it from there.

More difficult to do if you use typical capital sources for search funds (loans or capital structure with different classes of shares) or if you use other instruments where creditors/investors have different types of right.. For example, lenders bargain for covenants and other protections, including to prevent asset stripping, self-dealing, insider or related party transactions, etc. Similarly, different classes of equity may have liquidation preferences or approval rights for specific activities. These are just a few examples. If you are operating multiple, separate vehicles with different capital structure and investor bases, you have to be very careful to avoid violating finance documents and restrictions or shareholders rights. Notably, apart from what is on paper, directors and majority owners may have legal obligations to the company or its shareholders. For example, directors in many jurisdictions have a duty of loyalty to the company or cannot oppress minority holders. This makes it tricky to treat multiple companies "as one" if they are not actually "one." Be careful, especially if your companies have different sets of stakeholders, even if there are not formal agreements like loans or shareholder agreements that specifically address these matters. There are ways to achieve synergies, but you'll want to be careful, and duly and defensibly document actions that are required to be arm's-length.

Are you looking to buying multiple types of businesses and operate as one? Or merge multiple similar businesses into one?

There are many examples of the latter in search, including: vector disease control and palatiumcare. However, my guess is that there is little benefit to doing the former. You might run into the problems Matt mentioned above, plus running multiple types of businesses may lead you to be distracted and not as knowledgeable about any particular one and it may be harder to sell a conglomerate that an individual biz.

Read the Chenmark case, that's their thesis (Higgins family). So far, it works good for them.

Rich, I would love to read this as well. Appreciate it! [redacted]

Rich, can you send to [redacted] Thanks!

a well-rounded controller/cpa could be a start

Feel free to message me, we are in the process of doing a rollup of legacy software companies.