Traditional Search EIR Model Vs. Syndicated Cap Table

February 07, 2026

by a searcher from University of Southern California - Marshall School of Business in Irvine, CA, USA

Has anyone consciously made the decision to construct a search cap table with either 100% or majority funded from a single investor vs. several more evenly distributed investors? If so, what swung you in one direction or the other and what did you see as the biggest pros and cons to each?

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Reply by a searcher
from University of KwaZulu in Vancouver, BC, Canada

The biggest risk is who is the decision maker in each scenario. If you have a concentrated cap table (even if top 3 are >60%), you are effectively beholden to the views/limitations of the majority. If that majority doesn't like a deal but you do that limits your ability to execute. The larger the concentration the more pronounced this effect will be. Worth noting that investors may decline a deal for many reasons other than the economics (industry/regional concentration in their portfolios, personal views, have been burned by said industry before etc.). The benefit is that if a deal is attractive and the majority participates there are fewer moving pieces to manage across the cap table.

Reply by an investor
from McGill University in San Diego, CA, USA

Thanks for the tag ^redacted‌. I obviously have a biased take. So, let me point you towards AJ Wasserstein's notes on the subject. He has written about this extensively and talks about the pros and cons of each of the search fund models pretty objectively. (https://som.yale.edu/faculty-research/faculty-directory/aj-wasserstein).

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