Jeremy Yamaguchi
@jeremyyamaguchi
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Built & exited multiple home services platforms. $100M+ GMV in lawn care & cleaning. Bootstrapped → YC → PE. Now building a venture roll-up in pool service
Where the C-beams glitter
Joined March 2008
Well would you look at that.
Venture firms including Khosla Ventures, General Catalyst, and Thrive Capital are testing a new investment strategy, involving acquiring mature, low-tech service businesses and modernizing them with AI tools internally. These targets, such as call centers, accounting firms, and.
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First day in the new office. Next, we engage in the most sacred of rites: naming conference rooms.
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Another huge name enters the venture roll-up game 😌. This M&A-first model is rapidly moving from fringe to fully consensus.
We are humbled to announce Thrive Holdings, a permanent capital vehicle dedicated to investing in, acquiring, and operating businesses for the long term. The mission of Thrive Holdings is to transform enterprises through the strategic application of technology to foster enduring
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Folks have been asking what industries this model works for. You want to look for the following:. Highly fragmented market → lots of acquisition targets. Recurring, non-cyclical revenue → businesses worth buying and that can support modest leverage. Homogeneous service lines →.
A year ago, I made a weird bet: that you could raise venture capital to buy boring old businesses—and scale them like tech startups. Most the VCs I pitched said their LPs wouldn’t get it. Now those same firms are raising billion-dollar funds on this strategy. Here's the thesis:.
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The legendary companies of yore began in a garage with a fateful push to prod. The next generation of greats might kick off with an LOI, a diligence checklist, and a firm handshake. Exciting times.
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This isn’t the next wave of private equity—it’s the next wave of venture. And if we’re right, there will be a whole generation of founders who start with acquisitions, and build their software after the fact.
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And if you build software that materially lifts EBITDA on day 30—not year 3—you’ve got something better than SaaS. You’ve got a proprietary margin expanding machine that makes you the obvious best acquirer for any high quality companies in your market.
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“Just build a tech-enabled services company from scratch—it’s cleaner”. Sure, if you want low growth, slow learning, and no data advantage. Buying first gives you a lab:.Petri dish of P&Ls to experiment on.Distribution on day one.Actual margin to fund R&D.
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“This is a roll-up”. Yes, but not your dad’s roll-up. Dad bought 100 dentist offices and bolted on an operating playbook. We’re rebuilding the P&L with proprietary software and LLM-powered dispatchers.
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"This only works in certain industries". I agree!. This mostly works in large, non-cyclical, fragmented industries where you can drive real tech leverage, and where you have largely homogeneous companies to limit integration risk. Not every category is well suited for this model.
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“But buying and integrating companies is hard”. Definitely. But so is engineering virality in a social app, building a capital intensive hardware startup, or breaking into enterprise SaaS with glacial sales cycles. Doing hard things well is the point.
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Now, objections:. “This is just PE”. Nope. PE operates on 3-6 year hold periods—they don't have the tech DNA or fund horizon to invest in building custom software. This is venture risk: can you actually transform ops and expand margins with AI? Can you programmatically scale M&A?.
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It’s venture-style upside with PE-style downside protection: instead of burning cash and racing the runway, you're buying a growing basket of cashflows—and using them to fund R&D and future acquisitions. The model’s capital-efficient from day one.
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This model's better for founders too. Classic 2 and 20?.Search fund economics?.Independent sponsor models?. They all leave you with vastly less ownership, and aren't designed for a world where founders spend 10+ years compounding to a billion-dollar outcome.
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This is quickly becoming more consensus: Why not just buy your customer and capture their margin++?. Buy the legacy business, build the tech, grow like Stripe but with guys in Tacomas. It’s not just a roll-up. It's a novel SaaS GTM motion masquerading as a small business buy out.
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Other venture firms like a16z, Founders Fund, Slow, and Luxe are moving in. Metropolis bought parking lots, jammed software into them, and raised $1.8B to do it at an even bigger scale. AMCA just raised $76M and is doing this in defense manufacturing.
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A year ago, half the VCs I pitched said:. “This is great. I’d like to invest personally. But my fund can’t touch this—our LPs wouldn’t get it”. Now? General Catalyst just raised a $1.5B venture roll-up fund. Not PE. Not growth equity. Venture. But for buying companies.
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At Cabana, we buy pool service companies. Yes, pools. Chlorine, vacuum hoses, sunburns. But instead of chasing down $50/month SaaS subscriptions, we use our pool business as the bootloader for vertical software. We capture 100% of the economics—with $0 CAC and zero churn.
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What’s more, using acquisitions as the bootloader for vertical software lets you break into markets poorly suited for traditional SaaS. Many highly fragmented, low LTV, hard-to-sell-into categories can now be unlocked with this approach.
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If you can use venture dollars to:. ✅Grow at venture speed.✅Build tech to expand margins and forge a moat.✅Build an IPO-scale business on venture timelines. …then who cares whether you started in a garage or with an asset purchase agreement?.
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