Self-Funded Question: Raising Capital for Transaction Expenses

June 16, 2025
by a searcher in New York, NY, USA
Question: Would it be possible to do a small raise of friends and family money ($100k-$200k) for transaction expenses (legal and accounting) as you perform your self-funded search? The F&F investors would have their drawn portions roll into the acquired company as equity.
As we all know, self-funded searchers are frequently stressed about the financial runway they have as sunk deal costs start to add up from dead LOIs. This seems it could be a viable solution. I guess this would almost be a hybrid between self-funded and traditional search. The key difference is you're not raising a salary amount and the investors are F&F vs. institutional.
Let me know if someone has experience with this, or if it seems like a viable solution. Thanks!
from Southern Illinois University at Edwardsville in Laramie, WY, USA
from University of Virginia in Holmes, NY 12531, USA