Company-as-Search Fund Manager?

searcher profile

June 19, 2022

by a searcher from University of California, Berkeley in Miami, FL, USA

Hi all - has anyone examined having, rather than a single searcher or two searchers, an entire tech company as a Manager? I see from the Stanford Search Fund Study that there is heavy bias (2x+ more likely) on 5x+ returns to partnerships rather than solo searchers.

Our thesis is that a full company with an engineering team, tested AI, and specific sector expertise could do much better than existing dominant search modes.


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commentor profile
Reply by a searcher
from University of Pennsylvania in New York, NY, USA
Interesting survey paper, but on this specific post topic, seems like there's too man underlying variables to make a strong claim? ex) starting the search with more than 1 person vs. starting with a full team, verticalization naturally being more profitable as a roll-up strategy vs. horizontal acquisitions, simply resources available to you as an individual being less vs. having more bodies... Appreciate the commentary above, but given the cost charged to the ManagementCo in whatever form, searcher's unit economics/return would come down materially?


For instance, Marriott is a RE volume game vs. individual hotel operators make $ based on their single-asset operations, so margins are materially higher for the latter, albeit on a smaller revenue base. Maybe I'm not getting how this is different from funds-of-search-funds that are broadly available.
commentor profile
Reply by a searcher
from Stanford University in San Francisco, CA, USA
That model already exists my friend. At a larger scale, every publicly traded tech companies have a team that just focuses on finding companies to acquire on the daily basis.
Oracle is one example of that. They acquired more than 40 companies under the umbrella of Oracle.
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