Do you ever explain what a search fund is in your cold outreach emails?

September 09, 2024

by an member from University of Washington in Mount Vernon, WA, USA

I'm wondering whether or not to include the extra information which could be useful if a seller isn't familiar with the process but could also make the email less interesting and more bulky. What do you usually do?

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Reply by a searcher
from Boston University in Boston, MA, USA

^redacted‌ thanks for including me. I would agree with the others that have commented already. Whenever I have sent a direct letter to an owner, whose business is currently not on the market, I always start with a very high-level introduction about my corporate past, and just briefly mention that I kicked off an independent search for business acquisition. I also mentioned that I’m working With one or two other potential partners. I think it’s also important to mention why you like the owners company and the industry and then just simply ask what their plans are in the long term. You can position it by asking if they are interested in raising capital or if they are looking at a potential, outright sale of the business.

I would not get into the technicalities of the independent or the sponsored search process until you get face-to-face. Hope this helps. Happy to chat. Regards, Rob.

Reply by a searcher
from University of Virginia in Charlottesville, VA, USA

2c from a guy who has done plenty of cold outreach but has not raised a traditional search fund. Keep the message as simple as possible. Some folks may have follow ups about how you'll finance your acquisition, and you can explain you have investor relationships with capital earmarked for you. What they're really trying to get at is whether you can successfully finance the deal. But let them ask those questions and take them as they come.

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