There are many parts that encompass forming a company and, in many cases, this also includes the difficult decision of choosing a name. Sometimes this is a creative decision, but it is also often a decision that can make or break your company.
When it comes to naming a holding company, there are not a huge number of requirements specifically for these companies, it does not even need to have the term holding company in the name. However, the company structure may dictate how you must name your company.
What is a Holding Company?
A holding company can be a corporation or a limited liability company, also known as an LLC. Holding companies do not produce any products or services, they simply oversee the business. They can control subsidiary companies because they hold the majority stake of business’ stock.
For example, a holding company would have to hold at least 51% of a company's stock to be able to control the business. A holding company is separate from the company that it controls. Meaning it can have it’s own rules and it’s own name. The name of a holding company doesn’t have to be relevant to the subsidiaries that it controls.
Qualities of Great Holding Company Names
When naming a holding company, first off, it is essential that you ensure the name is legal to use. It cannot be in use by any other company. It should also work for the industry you are in. If you are an agricultural business you might not want to use a technological name, but if you are a family business using your family name might be a good idea.
Be sure to choose something that is unique regardless. If it is too similar to your competition then things may get a bit confusing. You can also think about how it may look when transformed into a logo, or if this is even possible. The following might help you in figuring out the best course of action to take when making your holding company.
Name is short and strong
When it comes to a strong name for a holding company it is one that you can hear once and remember again. This typically means that it would be short and strong. For example, the name “Apple”. This is a common name that you can hear once and remember. This makes it incredibly strong for a holding company or prominent parent company.
Company names should not be specific to the city or state it is formed in. Rather, a company name should be versatile and allow you to expand easily.
It is essential that you spell your company name correctly so as to not confuse customers. For example, do not change an E to an X, such as “Extreme” to “Xtreme”.
Domain name is available
In many cases having a great name will not matter if you cannot obtain a website to match it. For example, using a “.com” domain name is the most reputable. In some cases, you may be able to choose “.co” as well. Despite this, if your name is not available as either one of these options, you may want to choose a different business name altogether.
What the name is in other languages
For any company that is doing business abroad, it may be smart to take a look at the meaning of your business in other languages. For example, if you are a vegan-based business, you may not want to name your business “DANA,” even if it stands for something.
This is because in Turkey, “Dana” means beef. Having a vegan brand named “beef” in another language might be very confusing. Use a translator to ensure that your potential name will work in a variety of languages that you might end up doing business in.
Easy to read
Another aspect of a good name is that you can easily pronounce it when you read it. It should not be something that customers have to try and figure out. Instead, it should be easy to read, pronounce, and understand.
Examples of Holding Company Names
Coming up with the name of your holding company can be difficult. Here are a few of the most well known holding companies to give you an example of holding company names.
- American Express Co.
- Johnson & Johnson
- S. Bancorp
- Visa Inc.
- Proctor & Gamble Co.
- Wal-Mart Stores
- Coca-Cola Inc.
Why is a name so important?
A holding company is a business entity —oftentimesa limited liability company (LLC) orcorporation — thats only purpose is the buying andoperation of other companies. It does notsell or buy any products or services, although thecompanies it owns might.
Naming your holding company is likely not a high priorityfor many entrepreneurs as there aremany legal steps to go through before naming yourcompany becomes a reality, but this doesnot lessen the importance of a good name. As soonas it is reasonable to do so, significantthought should be put into deciding the name of yourholding company.
Despite a holding company not directly selling anyproducts, the importance of its name is stillvery significant.
It is important to pick a name that accurately reflectsthe purpose moving forward of yourcompany, as well as being memorable and unique toensure you stand out in a crowdedbusiness ecosystem. This can be a difficult processfor many people, but just because you don’talready have a name for your holding company doesmean you can’t still come up with theperfect name. Choosing a good name for your holdingcompany can seem like a complicatedprocess, but there are many rules that when followedcan lead you in the right direction.
Tips for naming a holding company:
Find a reference:
Is there a business you already admire, or are therealready established competitors in yourfield? Oftentimes these companies can be a great pointto start when choosing the name foryour holding company. This can mean following thesame process that these companiesfollowed when choosing their names or just takinginspiration from their choice.
Don’t get too specific:
Many holding companies make the mistake of limitingtheir potential scope by picking a namethat is too specific, either in location or subjectmatter. Avoid names of places or specificproducts in your holding company name to avoid confusionand allow for a smooth expansion ofyour holding both in location and assets. Althoughhaving a specifically named holding companywill not stop you from owning other assets, it canbe confusing in a way that is damaging to theimage of the holding company.
Create a marketable name:
Many of the basic rules of marketing apply even moreso when choosing the name of yourholding company. A name needs to be memorable, unique,succinct, easy to spell and say, andmore. This can be a lot of requirements for many businessowners, but the importance offollowing these requirements cannot be understated;breaking these rules can have significantnegative effects on the image and reputation of yourholding company.
Choose a name that is legal and available:
There are a large number of companies registered ineach state, which means a lot of potentialthat your name has already been used by another business.It is a good idea to check theSecretary of State and the Patent and Trademark Office’swebsites to make sure that yourchosen name is not already taken in a way that wouldprevent you from using said name foryour holding company.
Another part of making sure that your chosen nameis available is checking for the availability ofyour desired domain name. In the technology age, everybusiness can benefit from having anassociated website, but this can be difficult if thedomain name associated with your business isnot available. Because of this, it can be a good ideato avoid choosing names that do not havean available associated domain name.
Getting Help Naming a Holding Company
Getting help from a lawyer can sometimes be a good option. This can ensure that your name of choice is not already in use, and they can typically recommend a few names. If your name, of course, is already taken then you may need to explore other avenues, and sometimes this begins with a bit of thought and a bit of help from a lawyer.