How to find operating talent when you don't have the deal

Spoke with a business buyer who asked the question I get a lot: “How do I find the key talent before I have the business?” This was not a former PE analyst wanting to use an SBA loan and hire a GM. He runs a $50 million manufacturing business. I see 3 potential solutions: 1. Start an OIR/EIR program Basically, an internal search fund. You provide a basic salary ($100-150k), support in the acquisition process, and capital when the time comes. Expect slightly better economics than a normal search fund as you are a single source of capital for the search. Have a fried with a fund who likes to find people with 20+ years of industry experience in a vertical. The kind of person that knows as much or more than the seller. They just don’t know how to run an acquisition process. So he supports them with that while putting them in front of sellers and then having them run a business in an industry they already know. 2. Start a CXO program or hire a Chief of Staff Chenmark and Alpine are both groups that have some flavor of this model. Hire high-quality, ambitious people and put them to work inside the portfolio. Maybe they rotate around or maybe they are the right hand person for a port co CEO. Whole intent here is to have them do operational work now, grooming them for a CEO/GM/President role later. Goes best when you have real structure around a leadership development program that offers them more than just internal work. 3. Hire me Also an option when you have a deal in hand. 4. Network, network, network Being lead recruiter is a key part of being a CEO. You can go and make an effort to find and connect with the kind of people you want leading your companies so that when the time is right- you can strike. Takes time and lot of effort. — Especially if you sit more in the “acquirer” seat and less in the “operator” seat, you have to have some type of strategy to fill the talent pipeline to align talent with deals.