$5T Opportunity: AI Roll Ups

Channel: Greg Isenberg
Published: September 28, 2026
Video: https://www.youtube.com/watch?v=ZT4mpjx0JnE

Transcript

Over the next 10 years, there's going to be millions of small businesses that are going to get sold because their owners are retiring. We're talking about $5 trillion worth of these businesses. Now, some of the biggest investors in the world like Thrive and General Catalyst are already buying them up and they're using AI agents to make them way more profitable. Most people think that billion-dollar funds can only do that and there's just no room for solo founders or small teams. I don't. I think there's a huge opportunity here for solo founders and almost nobody's talking about it.

I posted about it on X yesterday and it got over a million impressions. The funniest part was that my DMs and replies were filled with people messaging me to stop talking about it publicly because they think there's so much alpha in this. So, obviously, I'm making a whole episode of the podcast about this and you're listening to it.

If you stick around until the end, you'll learn three things. You'll learn why this is happening right now and how Thrive and General Catalyst are actually doing it. You'll see exactly how I'd run one as a solo founder down to the folders, the agent files, and what my average week would look like. And you'll hear the biggest arguments against this, including the one I take most seriously.

If you're new here, I'm Greg Eisenberg. I run a holding company of my own. I host the Startup Ideas podcast and I spend most of my time thinking about which kind of businesses are worth building right now. If this episode gets 5,000 likes, comments, subscribes, I'll give away more of my notes on this whole topic.

Why This Shift Is Happening Now

I think three things happen at the same time and when that happens you usually get a new kind of business.

The first thing is owners are retiring. That $5 trillion number actually comes from McKinsey and they expect about a million of those businesses to actually sell by 2035. These are people who started an accounting practice or an insurance agency or property management company, maybe in the 80s or in the 90s, but they've built a loyal client base over 30 years and now they want to retire. Maybe their family doesn't want to get into the business. They don't have people lined up to take it over. Their kids went off and did something else and their employees usually don't want to run the whole thing.

The second point is AI can do the work now. I don't think I could have said this eight months ago, but I'm saying it now. Think about what happens inside those businesses all day. Someone types numbers from a PDF into a spreadsheet, and someone chases a client from the same missing document for the third time. Someone writes the same status update like 50 times a week. Not long ago, if you pointed AI at that work, you got a rough draft and someone had to redo it and it was hallucinating all the time. Now, if you set it up correctly, you get a draft that somebody checks. I'm getting to the point where I can trust my AI agents and my AI agent systems sometimes way more than my human beings. My human beings on my team are making more mistakes than my AI agents.

The third piece is service businesses are priced like their margins are stuck. A normal service firm runs at 5 to 10% profit, something like that. And everyone assumes that it'll just sort of stay that way because that's been that way for the last 30 years. That's how buyers value those businesses.

When you put all three points together, you get a huge wave of businesses about to change owners full of the exact kind of work agents are good at and priced as if nothing about them can change. And I think that's one of the biggest opportunities right now.

What The Big Funds Are Doing

Thrive Holdings is Josh Kushner's firm. They were early in companies like Instagram and OpenAI, and a while ago they spun out something called Thrive Holdings. They went out and bought local accounting firms. They've bought close to 50 of these accounting firms over the last 24 months, and they just committed another billion dollars to buy more.

One of them is a firm in Bellingham, Washington called Larsson Gross. It's been around since 1949. They've got five offices and 200 people. After Thrive got involved, the firm started using AI built on OpenAI's codecs. This tax season, it processed 7,000 returns. An accountant saved 31% of their time on average. One accountant had a job that used to take her 180 hours a year and she got it down to 15. The interns who used to prepare tax returns started training to review them instead. The people who used to do the work are becoming the people who check it.

General Catalyst is one of the biggest venture capital firms in the world. They set aside $1.5 billion for this strategy. From what I heard, they put more than $750 million into at least 10 companies. One of them is Long Lake, which buys property management companies. They say that they've bought 18 businesses and gotten to $100 million in EBITDA in under two years with margins doubling. Another is Crescendo, which runs customer support centers. They say AI now handles about 90% of frontline tickets.

One I really like the structure of: when General Catalyst companies buy a business, they usually pay about 60 to 70% in cash and the founder rolls about 30% equity into the new company. So the person who built the relationship for 20 or 30 years has a real reason to stay and make the handoff go well.

One honest note: a lot of these numbers are self-reported by young companies that are raising money and none of them have been through a recession yet. So I take them as a strong signal of where this is going, not as proof. But when you have Thrive and General Catalyst, both venture firms putting billions of dollars into the same idea, you've got to pay attention.

The Playbook They're Using

The simplest way I can describe it: first they build the platform—meaning the agents and the software—before they buy literally anything. Then they buy a firm people already trust, with clients who've been around for years, a lot of the time with good brand names. Then they run the agents in the background. The agents do the work alongside the people and nobody outside sees anything change. If anything, they're more timely, it's more optimized, customers are hearing back faster, and they're getting hopefully better work.

Once the agents are reliable, they move the back office over—things like data entry, collecting documents, and first drafts. Then they buy the next firm and plug it into the same platform.

Look at what that does to the business. Revenue stays the same because the clients are the same and they're paying the same invoices. Costs go down because agents are doing a big share of the work. So profit goes from anywhere around 5 to 10% to, if the thesis holds, 30 or 40%. It's basically the same business making three to four times profit.

The thing I think most people miss is that the funds need big deals. If you're a billion-dollar fund, you can't spend your time on a bookkeeping firm doing $2 million a year. It's just too small for them and it can't move the needle. Those million businesses expected to sell are mostly small firms. So Thrive and General Catalyst, I don't think they're going to call them. I think they're going to call the bigger firms or the mid-market firms.

How I'd Set It Up As A Solo Founder

So, how would I set up a one-person holding company doing these AI rollups?

You, the founder, are at the top. You own a holding company, which is just a company whose job is to own other businesses. That's the simplest way to think about a holding company. Under it, there's a few small businesses. Each one has a GM, a general manager, and usually that's someone who's already there. Think of it as like a senior bookkeeper who's been with the firm for 15 years, knows every client. Then you make her the GM and give her a real piece of the upside.

This bar at the bottom is the part that makes the whole thing work. Every business uses the same agents, the same rule system, the same back office, and the same dashboards. You build the layer once, so the second business is easier than the first because half of what it needs already exists. Then the third one is easier again, the fourth, fifth—you get the idea.

Why There's Room For Solo Founders

At the start I said there's a huge piece of this pie for solo founders and there's a few reasons why I believe that.

The tools are the same. Thrive agents run on Claude. But you can use Claude, Codeex, Gemini. You have access to the same models.

You get to be the integration. The hardest part of any rollup is getting each new business onto the system without breaking anything. The funds have to hire managers who learn every business from scratch, while you're the one in the room. You know the clients and you read the agent drafts yourself.

A lot of owners would rather hand their business to a person. If you spent 40 years building something you care about, you care about who takes it over. Some of them just don't want to sell to a large venture capital firm, but they might want to sell to you. That's an edge.

The deals are too small for the big funds. You're not even competing with General Catalyst for them.

I've run a holding company for six years now, and I've got to say that who the GM is will be such an important part of making this thing work. I've seen not-good GMs just not be able to take the business where it should get to, and incredible GMs just really fly. Finding that person is super important.

The Folder Structure

This is something you might want to screenshot. This folder structure is kind of like the org chart.

The thesis folder. This is where you're going to write down what you believe—like which industries you're in and why, what a good business looks like to you. And that's going to keep you from buying something just because you got excited about it.

The shared folder. This is that bar at the bottom of the drawing—everything every business uses. The agents and the global rules live here. There's also a folder of real accepted work that you use to test the agents every time you change something. And there are runbooks, which are just step-by-step instructions for things that happen more than once. Like: what you do on day one after taking over a business, or what you do when an agent sends something wrong.

Each business has its own folder. The clients file says who's been with the firm for 20 years, who's sensitive, who's loyal to a specific person. Those details are going to matter. The people file says who knows what. If the senior bookkeeper is the only one who knows how a certain client likes things done, that gets written down here. The rules file holds things that only apply to this business. Maybe this firm always sends reports on the third instead of the first because one big client asked for that in like 2011. The corrections log is where every fix goes. Anytime a person changes something an agent did, it gets logged here.

If you set up only three files, I'd say set up the global rules, each business rules, and the corrections log because that's the stuff that turns agents into something you can actually trust with a client.

And even if you don't do an AI rollup, thinking about your business in this way is pretty helpful from a structure perspective, from getting more out of your AI agents, and for just being more AI native.

(capture appears truncated)