Search Fund Strategy: Standing Out in a Crowded Market

Search Fund Strategies: Standing Out in a Crowded Market

March 7, 2024

Search funds face increasing competition due to their growing popularity. This surge in the number of search funds entering the market intensifies the competition for acquiring businesses, particularly those not actively on sale but with potential for growth and profitability.

The traditional approach of building personal rapport with business owners—essentially positioning oneself as the “son or daughter the owner never had” or as “the only person who can maintain the seller’s legacy”—relies heavily on creating a personal connection and trust.

It suggests that the buyer is not only interested in the financial transaction but also in preserving the company’s culture, values, and legacy post-acquisition. This strategy aims to differentiate the buyer in a market where sellers might be wary of selling to someone who could dismantle their life’s work.

However, with the increasing popularity of search funds and the resultant proliferation of search funds in the market, these personal appeals might be becoming less effective as unique selling propositions.

Many sellers are likely encountering multiple buyers attempting to leverage similar narratives, reducing the novelty and, potentially, the effectiveness of such approaches.

In light of these challenges, search funds may need to innovate their approaches and value propositions to stand out. This could involve…


Demonstrating Deep Industry Insight and Value-Add

Beyond personal rapport, showing a deep understanding of the seller’s industry and articulating a clear, compelling vision for the company’s future under their stewardship.

Leveraging Unique Skill Sets or Networks

Highlighting unique skills or networks the searcher can bring to the table to grow the business post-acquisition.

Providing Favorable Deal Structures

Crafting deal structures that are attractive to sellers, such as offering better terms, ensuring financial security, or accommodating the seller’s desire for ongoing involvement in the business.

Focusing on Speed and Certainty of Execution

Emphasizing the ability to move quickly and efficiently through the transaction process, which can be appealing to sellers eager to close a deal without prolonged uncertainty.

Building a Strong Personal Brand and Online Presence

Establish a compelling personal brand that highlights your unique strengths, background, and vision for the businesses you aim to acquire. This includes a professional website, active engagement on professional social media platforms, and contributing to industry publications. Your personal brand should communicate your value proposition clearly and differentiate you from other search funds.

Showcasing Operational Expertise

If you or your team have a track record of successfully growing or improving businesses, make this a central part of your pitch to sellers. Operational expertise and a clear plan for adding value to the business post-acquisition can be a significant differentiator.


Ultimately, as the search fund landscape becomes more crowded, the ability to differentiate oneself and offer tangible value beyond personal connections and assurances will likely become increasingly crucial.

Adapting strategies to the changing market, leveraging technology and networks, and focusing on creating genuine value for both the seller and the acquired company may help search funds navigate these challenges successfully.

Search fund investors, such as ETA Equity, assist search funds in differentiating themselves with business owners, brokers, and other spheres of influence.

Contact us at to learn more.