Career contingencies - what do you do when things don't work out?
September 08, 2021
by a searcher from IE Business School in Cambridge, UK
As I explore a search fund as a career path, a clear point of consideration is what if things don't work out and what are the career implications.
Namely:
1) if you're part of the 33% who did not find a good enough deal to invest in, how can you spin your experience of having searched for ~2 years and failed to have acquired a business?
2) if you're part of the 17% of searchers who do acquire but end up losing your/investors money?
Of course not acquiring is preferable to acquiring a bad company and is the best decision, but it would be good to hear experiences around the career implications of both "negative" outcomes, especially in a UK context.
Many thanks!
from Stanford University in Bellevue, WA, USA
I am a failed search funder. I am part of the 33% group that didn't end up finding a company to buy. I ended up shutting down my fund in the beginning of 2000 and returning money to my investors as I thought valuations had gotten too high and I was afraid of buying at the top of a frothy market. This was during the dot com bubble and it seemed that almost every company had crazy valuation expectations. Shutting down the fund was very difficult and very humbling. Hopefully, everyone has a good support system around them if it happens because it can be a difficult time.
But I was quickly able to land multiple job offers afterward in both business development and product marketing / management. Luckily, the job market was still strong at that time. I fell back on my previous credentials / work experience and you can spin your experience doing a search fund multiple ways. In particular, it lines up well with business development, corp dev, or finance work.
So from my experience, it didn't stop me from getting a job afterward. Yes, you may not be as far along in your career as if you had taken the more traditional path but that is part of the tradeoff.
The bigger issue that Professor Grousbeck (everyone on this website should know who he is) talked about is that after you take the entrepreneurial path it becomes very hard to work for someone else in a corporate organization. I believe the phrase he used to describe it was "constitutionally unemployable." You will be constantly searching for ways to get back to being an entrepreneur.
That was certainly my case as within 2 years, I was back out on my own again. This time utilizing the experience I had gained from doing a traditional search fund to do a self-funded search and focusing on buying technology companies during the dot com bust which turned out to be fruitful and a path I have stayed on for the last 20 + years.
Bottom line is that despite having a failed search fund, things have gone well and I wouldn't change it.
from Stanford University in Honolulu, HI, USA
1) Look, Listen, Let it Go - Lessons from a Failed Fundraise: https://www.searchfunder.com/event/view/418
2) Lessons from the Zombie Apocalypse (Story of a failed acquisition): https://www.searchfunder.com/event/view/355
3) Family & Failure - The Emotional Aspects of Search: https://www.searchfunder.com/event/view/456