"Holtz, Daniel, vampire killer, circa 1754. He hunted Angel and Darla halfway around the world until his mysterious disappearance in 1773. Larson McMillian Vampiricus Conquestus page four twelve."
That is to sum the man who was Daniel Holtz according to Wolfram&Hart's 'Files and Records'. Now was that really that much more to him? There probably was, but it all centered around vengeance. Take the vengeance away and you couldn't receive an emptier person. Did Angelus really see to it being that way by murdering his family? I guess that's a yet another thing that's open to debate.
We don't know when Holtz was born. We can only rationally estimate he was in his forties when he came across Sajhan.
So, Daniel Holtz, aka Captain Holtz. He was no different from any other man of his time, he was married to Caroline, father of two children, Sarah and Daniel, had a house to come back to in England's York, had a job…as a vampire hunter.
We know for certain Holtz had come across Angelus and Darla way before they killed his family. In fact, the reason they did the deed was only to laugh at his expense, so the conclusion is - they go way before that. As a vampire hunter, he and his team focused on Angelus and Darla for given reasons, if to take in the murderous couple's reputation all across Europe. Holtz's fixation on a target was apparent even then, but unlike it doomed him in the sixteenth century, it didn't in the twenty-first. The first time, his fixation on Angelus and Darla cost him the lives of the most dear to him, his family. His fixation on the vampiric couple grew much stronger, this time fueled with a burning vengeance he called justice when he began pursuing then, but this time not merely for being vampires, but for murdering his family (they didn't just murder them, by the way, they left him a present - turned his little daughter, so that Holtz had to put an end to her (un)life himself).
For years over years he hunts them allover the continent, but he keeps coming up empty handed. Growing more and more desperate and lost and having nothing more left to lose, he naturally jumps on Sajhan's offer - to bounce him years in time way into the future and then take his revenge on Angelus and Darla.
So Holtz accepts. He is being put to sleep and woken up after two centuries by Sajhan, into a world changed, a wold he doesn't know anymore, all to avenge the deaths of his family. His fixation and obsession with Darla and Angelus picks up from where it left off in the sixteenth hundred and he's getting ready for payback. Only that then Darla dies, stakes herself to save Connor, so that Connor could live. Holtz witnesses it, he is standing with his crossbow set on the remaining half of the couple, Angel, as the vampire cradling his son. That moment, Holtz as though changes his mind - he lowers the crossbow and lets Angel and Connor escape. Why he does that? Was there compassion, did something stop him from shooting the vampire while holding his son? In my opinion, no. Holtz finally realizes that the soul Angel was cursed by gypsies with, the soul in which effect he didn't believe before was actually a very valuable card to play with to his advantage. Killing Angel wouldn't do it, while harming him through his loved ones - would.
For months, Holtz is working on a single plan and using everyone in his way for it. His judgement is clearly clouded by vengeance, by hatred, as he uses people's grief to his advantage, as he's willing for people to die and kill for *his* cause rather than the lies he's been selling them. One thing to be told about him, he is smart. That intelligence allows him to pick his "victims" carefully, just the right ones, the ones who will obey unquestioningly and who will follow him blindly wherever he'd lead them. He picks the ones who experienced loss. Preferably, his kind of loss. And then he trains them to be putty in his hands.
So eventually he succeeds, he deprives Angel of the most dear to him - of his only son. He not only kidnaps him (by which being responsible for the destruction of Connor's character, childhood and God knows what else. Raising a child in the worst possible Hell dimension is not picnic…), but he also takes away his name, the name his father gave him, and trades it for another. If that's not enough, he brainwashes Connor in a similar way he did to his minions, ensuing complete devotion and obedience. He teaches him to *hate* his father, the man ho gave him life, to view him as a killer, as a monster. And that's how Connor grows.
Only that Connor finds his way back to earth and back to his father. In his heart, he's set on killing Angel, executing Holtz's revenge as he taught him, to kill the vampire. But he can't. We see that Holtz is disappointed with this turn of events, he didn't see Connor being so attracted and fascinated by his father, he didn't see it coming, that Connor wouldn't be able to kill him. To an outsider's eye, Holtz lost his battle against Angel, regardless to what he did, what he sacrificed for it. It seems the son he's done everything to alienate from his father is being drawn to said father by force he cannot resist.
But even that Holtz uses to his advantage.
He writes a letter to Connor, one which he passes to him through Angel, where he basically gives Connor back to his true father, where he wishes him all the best with his new family, where he lets go of him. The same night, he makes Justine kill him, puncture his neck, so that it would look as though done by a vampire, Angel. Connor gets the bait. Not for a second does he think he could be cheated by Holtz, cheated into something as horrible as backstabbing his father, he trusts him completely. He trusts him completely when he locks Angel in a box and tosses him to the bottom of the ocean for murdering Holtz.
Holtz played his final card. What he made Connor do, the way he used him, proves even him he never loved, regardless to what he was saying all along. He never loved anyone, he was incapable of it, all he cared about was vengeance and for that, he even destroyed the boy he supposedly raised as a son.