Advice on long-term hold search fund?

by a searcher

1 year ago

Hey everybody, I am debating the merits raising a search fund with the objective to buy a business for an indefinite long-term hold, eventually returning investor capital through dividends, a partial sale, or a dividend recap as opposed to a sale 3-5 years after acquisition.
Two questions:
Has anybody raised a search fund with this end objective? Would you be willing to share your experience with me?
Do folks have any advice on how to identify the subset of traditional search fund investors or single sponsors who would be interested in this strategy?

2 likes
148 views
4 comments

investor from Stanford University - Graduate School of Business

Pacific Lake Partners has significant investments in this model as well.

2 months ago | like reply | 0 likes

searcher from University of Texas at Austin

Talk with the potential investors about whether they are open to a LT hold. There are some that are open to it (Kamylon, GT, maybe Miramar) and some that aren't due to their own fund life documents. If they aren't open to it, have a good idea of how you might get them liquidity (recap it with a PE fund, buy them out yourself, secondary with other investors, or share buybacks).

1 year ago | like reply | 0 likes

More on Searchfunder

Just Closed on My First Deal! Reflections and Takeaways for other Searchers

45,152 transactions are available on Searchfunder (now searchable by keyword)

Now everyone has unlimited IBISWorld access

Family office looking for traditional searchers

Investor seeking Self-Funded Search Deals

2 Best Ways To Find Motivated Sellers, Off-Market Deals

Downsides of "buying a job" below 750k+ EBITDA?

6-7x for a Self-funded Search Deal?

Searchfunder is an online community and toolkit for searchfunds. Over 80% of those involved in searchfunds maintain a Searchfunder.com account to help them network, problem solve challenges, and keep up with the industry.

We maintain partnerships with database providers that make searching more effective, efficient and affordable along with features that help searchers find deals and investors and vice versa.