Before the searching process: Does a Search fund set up search guidelines?

September 16, 2020

by a searcher from WHU-Otto Beisheim School of Management in Düsseldorf, Germany

I'm an MBA Student at the WHU Otto Beisheim SoM from Germany. I'm currently writing my master thesis on Search Funds with the aim to set up my own, after finishing my MBA in the upcoming years.

I'm currently gathering information about the searching process and I'm curious to know if:

Search funds set up search guidelines just like a Private Equity fund would do?

This is strictly the guidelines of what to look for and what not to look for; I'm not talking about the screening criteria.

Any guidance, help, or tip you can offer, will be highly appreciated.

Thanks in advance!

Rodrigo Islas.

Reply by a searcher
from Northwestern University in Toronto, ON, Canada

Hi Rodrigo - You may want to check out the Search Fund Primer on Stanford's site. That will give you some good info related to this and other topics.

https://www.gsb.stanford.edu/faculty-research/centers-initiatives/ces/research/search-funds

Cheers,
Jim

Reply by a searcher
from Loyola Marymount University in Los Angeles, CA, USA

We're solo searchers with backing so may be a bit different for those that have numerous backers who have invested in to a search and have board authority -- for us we have basic criteria (size, target EBITDA, sellers note required, length in business, etc) but we also have a long list of diligence questions we've built and are continuing to build for which we expect certain answers to that serve as a secondary criteria.

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