Build, Buy, or Partner: How We Decide

A holding company is, at bottom, a machine for making a small number of large decisions well. The largest ones sort into three verbs: build, buy, or partner. Over the years we have settled on three questions that do most of the sorting for us.

Question one: is it core to a promise we make?

Everything starts here. Each of our companies makes a specific promise: we will find you customers, we will move your deal securely, we will know your inventory, we will carry your conversations. Any capability that sits inside one of those promises defaults to build, because a promise you outsource is a promise you no longer control.

Capabilities outside the promises default the other way. We have no ambition to run our own data centers or write our own telephony carrier software. Commodity layers are for buying.

Question two: does time favor the owner?

Some assets appreciate quietly in the hands of whoever operates them: proprietary data, customer trust, integration depth. Others depreciate no matter who owns them. We want to own the first kind. Our inventory data company exists precisely because normalized, current inventory data gets more valuable every year you keep collecting it, and we wanted that compounding on our side of the table.

Question three: can we run it better than its next-best owner?

This is the honesty question, and it kills more ideas than the other two combined. Adjacent markets constantly look attractive from a distance. Then we ask whether we would truly be the best operator the asset could have, knowing what we know, staffed as we are staffed. If the answer is no, the discipline is to leave it for the owner who can say yes.

Partnerships get the leftovers, deliberately. We partner where a counterpart brings something we should not replicate, on terms that keep the customer relationship with us. A partnership that owns your customer is an acquisition you did not get paid for.

None of this is clever. It is a short checklist applied with patience, which describes most of what a good holding company does all day.