Are Search Funds Only Viable Because Investors Accept Them?

I’ve been working on a succession-focused model in Germany, and a question has been on my mind lately: Are traditional search funds ultimately a vehicle that only exists because investors accept their logic – and does this filter out a large part of the market? Especially in Europe (and even more so in rural Germany), many succession opportunities are simply too small or “unscalable” to be a fit for investor-backed search funds. But these businesses are often profitable, rooted in their local economies, and worth preserving – just not according to the classic IRR-driven playbook. I’m wondering: • Have you come across alternative investment or financing models that allow more flexibility – e.g., revenue-based financing, seller notes, evergreen structures? • Has anyone tried to raise capital from non-traditional LPs like foundations, cooperatives, or impact investors? • What’s your take on the “investor pressure” dynamic – does it actually kill smaller but viable deals? Would love to hear your thoughts and experiences. I’m particularly interested in European or emerging market perspectives – but open to any views that challenge the default.