Could someone share some differences between the accelerated/ incubated/ single sponsor model versus the traditional SF?
I would love to hear the pros and cons of each model.
- How do terms differ?
- Exit ability?
- Deal sizes?
From my perspective, it seems like the following:
Pros of accelerated/ incubated model:
1. Resources/ education to get up to speed on search quicker
2. Group of searches to interact with and pass deals along too
3. Less time raising capital from###-###-#### investors and less time communicating updates
4. Potentially committed capital behind you, thus providing differentiation and a stronger chance of convincing brokers/ owners of creditability
5. better terms?
6. fewer investors to get on board for the deal and lose the dilution effect of search investors backing out at the acquisition phase
7. stronger search support
Cons:
1. Less control for the searcher/ investor has more influence
2. can't go through with deals if the incubator isn't on-board
3. less diversity of search investors to learn from or lean on for different views or expertise
4. only a few incubators/ accelerators exist relative to traditional search fund investors - they are more selective on searchers
5. Less flexibility on where to search
Accelerated/Incubated/ Single Sponsor Model versus Traditional Model
by a searcher
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Searchfunder is an online community and toolkit for searchfunds. Over 80% of those involved in searchfunds maintain a Searchfunder.com account to help them network, problem solve challenges, and keep up with the industry.
We maintain partnerships with database providers that make searching more effective, efficient and affordable along with features that help searchers find deals and investors and vice versa.
We maintain partnerships with database providers that make searching more effective, efficient and affordable along with features that help searchers find deals and investors and vice versa.
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