Brand new searcher here. I'm having a difficult time understanding the fundamental/structural differences between the Independent/Unfunded Sponsor and the Search Fund model.

Am I correct in understanding the main difference is that the search fund model is fundamentally designed to fund/bridge the search period for the principal, incentivizing initial investors through step-up's and preferential deal-level investment, while the Independent Sponsor model requires self-funding of initial 'survival' capital but is similar in other regards?

Thinking longer-term, would it be reasonable to assume that once an initial search-fund backed deal was exited, assuming profitably, a principal would likely move towards an Independent Sponsor or self-funded model for their next deal or deals?

Thanks in advance for any help along this new journey.