A Search Fund is…

A financial vehicle and an entrepreneurial path undertaken by one or two individuals (the “Searchers”). who form an investment vehicle with a small group of aligned investors, some of whom become mentors, in order to search for, acquire, and lead a privately held company for the medium to long term.

Search Funds Work.

They are a proven model and work by providing a unique solution to the growing pressures of succession events that the coming decades present in the Mid-Market sector. Search works because of factors that include

Willing sellers

The Mid-Market market in Australia is ready for transition.
40% of business owners in this sector are BabyBoomers. 75%+ of them have no succession or
transition plan and many don’t have the option of
generational transfer. While they are looking to retire,
they want a solution that will preserve their legacy.

Ready buyers

Searchers are discerning, smart individuals with entrepreneurial flair. They are passionate about taking what is already good and making it great. They understand legacy, ‘get’ people, and breathe business. They’ve done their homework. Searchers come with the confidence of being funded for the acquisition. They surround themselves with investors who fund the acquisition and are actively there to mentor and support them along the way.

Inefficient market

 Searchers know that this sector in Australia has no
one reference point from which to research their target
markets. They are ready to roll up their sleeves and dig
under the surface to find the opportunity others miss.

An incentive to perform

Searcher incentives are explicitly linked to the key milestones in the search process and the value they create for investors.  The Search Fund model drives alignment between investor and CEO interests.

Stable industries

Searchers primarily target Business-to-Business companies in non-cyclical industries to produce a larger
margin of safety.

Simple and sustainable

Searchers target companies that are a straight forward business, with understood and proven models, have low capital intensity, have high repeat business and experience healthy cash flows.

An option on future potential

Funding the search capital allows investors to get to know
the searchers well before serious funding is required for
any acquisition. We consider the Search phase
investment as an ‘option on future talent and potential.’
It’s a time to measure up and determine a Searchers’
suitability as the CEO of a company – well before they’ve
found it.

Global, collaborative community

The Search Fund community is collaborative by nature, and global in reach. The process is taught in MBA programs in many universities across the planet. Successful Searchers are deeply connected to the community of current and past Searchers, operators, investors, and the businesses and resources