Passive Investment Opportunity
Search Fund Accelerator
Backs individual operators (searchers) who raise capital, find a business to acquire, and then run it full-time.
Overview
The search fund model — also called Entrepreneurship Through Acquisition (ETA) — involves backing an individual (the "searcher") who raises capital to fund their search for a business to buy. Once a business is acquired, the same investors typically back the acquisition. The searcher then operates the business full-time. Search Fund Accelerators support searchers with capital, coaching, and networks to improve their odds of success.
Investment Model
Two-stage investment: (1) fund the search phase — a modest amount covering the searcher's living expenses and deal costs for 12–24 months; (2) invest in the acquisition when a business is identified. Investors receive preferred returns on acquisition capital, with the searcher earning equity through a graduated vesting schedule.
Target Returns
The search fund model has historically shown strong aggregate returns — Stanford research has cited median pre-tax IRRs in the 30–35% range across the asset class.
Individual fund returns vary widely. Many searches fail to result in an acquisition. Some acquisitions underperform. The aggregate return data reflects the full distribution, including losses.What They Invest In
- B2B services and niche industrial businesses
- Businesses with recurring revenue and clear management roles
- Companies in fragmented industries with consolidation potential
- Businesses where a strong individual operator can add meaningful value
Who It's For
- Investors interested in backing high-quality individual operators
- Those who want direct relationships with the people running the business
- Accredited investors comfortable with concentration risk
- Investors who understand and believe in the ETA model
What to Consider
- High concentration risk — all capital backs one person and one business
- Search phase may not result in a completed acquisition
- Returns are highly dependent on the individual searcher's capabilities
- Longer timelines — search plus hold can span 8–12 years
- Requires meaningful due diligence on the individual, not just the deal
Interested in Learning More?
Visit the company's website directly to learn about current opportunities, requirements, and how to get in touch with their team.
Educational listing. About Franchising does not endorse, recommend, or verify the claims of any investment opportunity listed on this site. This information is provided for educational purposes only. All investment opportunities involve risk. Consult a qualified financial advisor before making any investment decision.