A search fund is a special purpose entity created by an entrepreneur to acquire a profitable private company where the entrepreneur will step in as the CEO post closing. No two search funds are exactly alike - they can be funded or unfunded, they can have one searcher or two searchers, they can have dozens of investors or a single investor, etc. The common bond between all of them is that they are all looking for a company with a similar profile - and ideally the search fund entrepreneur will find a company that aligns with his or her personal interests where the skills required to grow overlap with the entrepreneur’s core competencies.
Search funds have been around for 25+ years; however, they’ve gained in popularity over the past decade. Whereas there used to be maybe a dozen searchers in the United States at any given time, there presently are over 200 active searchers working full time to find a quality opportunity - not to mention all of the executives who are considering an acquisition in their part time. As a result of these new industry dynamics, being the first search fund to reach out to a company can prove incredibly valuable.
ExitLink accomplishes three main things for search funds - we save them time, we save them money and we make sure they never miss a qualified opportunity.
Most importantly, every day counts for a search fund. ExitLink helps search funds ensure they never miss an opportunity. By aggregating thousands of public opportunities into a single location, a search fund entrepreneur will know they’re going to see almost every publicly available opportunity just by setting up notifications on ExitLink.
Search fund entrepreneurs may have also found that the listings submitted on many of the public sites are not easily sortable - or companies are miscategorized. As part of our aggregating algorithm, ExitLink recategorizes businesses to make sure a search fund doesn’t accidentally miss opportunities that were not entered properly on the original site by the banker or broker.
ExitLink also saves the search fund community time by giving search funds a single location where they can find and review all of the information they’d traditionally have to spend hours reviewing manually. And if a search fund finds a publicly available company that was not listed on our site, let us know and we’ll make sure we add that source location for future aggregations.
Lastly, ExitLink saves searchers money. Through our private database, search funds can enter their search criteria to gain access to deals that are not being publicly posted on deal websites. This feature is available for less than $100 per month - less than the cost of a LinkedIn premium subscription. We do not charge search funds by the number of deals received and we do not charge search funds a buy-side acquisition fee. Finding the same deal on an alternative platform might cost a search fund $200 per view plus a several hundred thousand dollars success fee if they close. It’s our mission to remove this information asymmetry without charging fees aligned to the traditional banker/broker model.
Examples of opportunities you can find on ExitLink might be a business services company located in the northeast with $1.2m EBITDA where the owner is looking to retire. Our criteria is to specifically look for businesses with $500k+ in either cash flow or EBITDA, companies located within the United States and companies that are actively being sold for the right price. While search funds typically look for tech enabled services businesses, we made the strategic decision to include all types of industries while making it easy for entrepreneurs to filter out opportunities that are not a fit for them. A car wash or a deli might not be a fit for you, but another search fund might be exploring a roll up of Burger King franchises, for example - you never know. Our plan is to make it easy for you to find the perfect company for you.
A search fund can best take advantage of ExitLink by creating a profile and setting up their deal criteria. From there, a search fund will receive notifications when publicly available deals are posted anywhere on the web and a search fund will receive notifications when an investment banker has a private deal that might be a good fit for them. Companies can also reach out directly to buyers when they’re considering a sale.
And perhaps the best way for a search fund to take advantage of ExitLink is to share your feedback with our product team. We are continuously improving the platform to make your search more successful. If there are features you’d like to see, let us know and we will add them to our product roadmap.
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