What's your pet theory to explain why some funded searchers manage to acquire a company, and others don't? Do you have a Brazil-specific theory?


Which factor would you say best explains the very high acquisition rate (100%?) for search funds established in Brazil prior to 2020, and the sharp reduction (approx. 50%) in the cohort that launched in###-###-#### /22:

A) Pandemic effects

B) Poor searcher selection

C) Randomness (reversion to the mean is a b:tch)

D) A mix of the above

E) Something else entirely

We'd be interested to see responses in the comments, let us know if this analysis changes your priors!


Some clickbait headlines based on the data:

- Searchers without an MBA have rarely acquired a company in Brazil via traditional search

- Searchers with M&A or search fund specific experience, prior to raising their fund, are notably less likely to acquire than searchers without

- Searchers with Sales or Entrepreneurial experience prior to raising their fund do not gain any apparent advantage, and represent only 1/3 of searchers

- Were it not for funds launched in 2021, Brazil would still be batting at an overall 90% acquisition rate (rather than 75%)

- Searchers that have acquired almost always had 3 or 4 employers prior to raising

- Searchers that have not acquired almost always had either 1 or 6-8 employers prior to raising










Searchfunder member‌ and I have a keen interest in understanding what makes a good search fund entrepreneur. Not only are we currently raising a fund (Green & Gold Capital), but we're also potential future investors. Like any other field, there are plenty of theses. We have our own ideas, based on gut feel and grey hair. Thankfully, Brazil now has a material number of funds raised and operating beyond the traditional 2 year search phase, so we decided to generate some data and conduct a preliminary analysis. The purpose of this post is to share the initial results and invite comment, questions, challenge, etc.

Using data gathered from LinkedIn, searchfunder.com and Google, we were able to identify 20 search fund acquisitions in Brazil and 7 search funds that have conducted at least a 2 year search without acquiring. We were also able to assess the qualifications and experience of the entrepreneurs of those funds based on their LinkedIn profile, and make certain observations or estimates to allow comparison in a structured manner.

All data was collected manually and evaluated subjectively, with no independent verification. Any errors or omissions are entirely our responsibility and we apologise in advance for any defects in these initial results. Sharing them publicly is meant to help identify any such issues. This analysis should not be relied on without independently assessing its validity and relevance. The sample size is limited, and interpretation may also be time and location specific. It is challenging to obtain complete and up-to-date data, as the situation is dynamic. We hope this data is complete or close to it, but are confident it will soon be out of date if it is not already.

Disclaimers aside, we think some of the results are interesting, and may give some readers pause for thought. If nothing else, it may stimulate some interesting discussions amongst investors and with prospective entrepreneurs! ^Searchfunder member‌ ^Searchfunder member‌ ^Searchfunder member‌ ^Searchfunder member‌ ‌^Searchfunder member‌ ^Searchfunder member‌