The HoldCo strategy that prints money in small markets

Most people think you need to be in a major city to build serious wealth.

They're wrong.

I just interviewed Joshua Kalinowski. He built a multi-million business empire in Casper, Wyoming (population 65,000). 

He owns a Coldwell Banker franchise, a roofing company, property management, solar, and even manufactures cold plunge tubs.

And he’s built it all using a HoldCo strategy designed for small markets.

You see, most people think a small market is limiting, but (if you execute well) it can actually act as your biggest competitive advantage.

In small towns, you're not on the forefront of industry changes. You're a lagging indicator by 2-3 years. 

That means you can watch what works in big cities, then implement those proven strategies without the trial-and-error costs.

There's less competition, lower overhead, and you can dominate multiple verticals faster than in saturated big cities.

In a smaller market, everyone knows each other. Your reputation in one business directly impacts your success in the others. Do good work, and word travels fast.

But beyond these natural advantages, there are strategic opportunities if you plan your business mix correctly.

Instead of putting all of his eggs in one basket, Joshua has built a holding company with complementary businesses that feed each other:

• Real estate franchise generates roof inspection leads

• Roofing company handles repairs for property management

• Property management creates ongoing commercial real estate opportunities

• Each business operates independently but benefits from the ecosystem

An approach like this can transform your entire business portfolio into one giant referral network that competitors can't replicate.

But the difference between success and failure in a model like this comes down to how you structure the operations. 

Most newcomers will build these portfolios without intention and end up subsidizing losers with their winners. Avoid the most common painful mistakes by following these rules:

1. Each business must be independently profitable. No cross-subsidizing weak performers with strong ones. If it can't stand alone, fix it or shut it down.

2. House everything under one roof. Joshua operates all companies from a 30,000 square foot building. You're literally one office away from solving problems across your portfolio.

3. Structured weekly accountability. Monday-Wednesday for operational meetings with each business unit. Thursday afternoons for reviewing P&Ls when you're mentally prepared to handle the numbers.

4. Hire your way out of the weeds. As you scale, consider hiring a COO to handle daily operations while you focus on vision and growth.

There are many advantages, but none of it matters without proper execution. 

You can have the perfect ecosystem of businesses, but if you're subsidizing losers or avoiding the hard decisions, you'll still fail. The framework only works when you force each business to stand on its own and hold yourself accountable to the numbers. 

Execute properly, and you can build an empire where others see limitations.

Until next week,

Erik

PS: If you're serious about building your own small-market empire, check out our private Facebook group. It's where franchisors and franchisees share what's really happening in their businesses—both wins and costly mistakes that don't make it into the brochures.