Search fund and covid19

by a searcher from Columbia University - Columbia Business School

4 years ago

Hello,

with covid19, many otherwise healthy companies will see their number turning red for this year, and maybe more. This will pull them off the searchers target list, and they will not match key criteria’s anymore like steady growth or profitability, reducing significantly the potential number of target. 
I’d be interested to hear from investors if they would consider investing in a company that has been doing well till the Covid crisis and then saw their number worsen, hopefully temporarily. How would you react if proposed this kind of deals? What key criteria would you require to ci it je the conversation ?

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3 comments

professional from Simon Fraser University

My advice; Focus on specific opportunities and rethink your investment criteria; Is the sector considered an essential service by the government authorities? How has the sector performed in March and April? Who are the target companies end customers/buyers? As a potential acquirer/investor do you have visibility into a companies results since and during the pandemic?

4 years ago | like reply | 0 likes

searcher from Duke University - The Fuqua School of Business

I think it is also important to evaluate the entire Covid-19 from the lens of a natural disaster. The major downturns we usually see are mostly "man-made". Covid-19, less so.

4 years ago | like reply | 1 like

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