Self funded vs traditional: deal size & keeping current job

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by a searcher from Clarkson University - School of Business
in Philadelphia, PA, USA

1yr ago

Self funded vs traditional: deal size & keeping current job

Hello everyone!

I have been talking to people in the search fund community and there has been a large push to go self funded instead of the traditional rout from everyone i talk to.

I am wondering if there is a major difference in deal size when you are self funded, is it not practical to do as large of a deal and if it is how do you garner the same deal size?

Also is it possible to keep a job where you’re working 40 hours a week and still search on nights and weekends? I will obviously leave post close.

open to discussion with anyone with these or similar insights they have!

thanks!

1 Like

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reply by a searcher 11mos ago
from George Mason University in Atlanta, GA, USA

I think both have merit. I'm in the very beginning stages of my search, and am doing self-funded for the moment, but would be interested in the traditional model. The thing that attracts me to traditional as a consultant is having the "team" aspect and more structure, which I'm used to in my career, while self-funded offers more flexibility and autonomy on the personal end.

reply by a searcher 11mos ago
from The University of Chicago in Anchorage, AK, USA

I said this in another post but applies here as well: As a traditional searcher myself, here are some counter points to what has already been said. Take it for what it's worth. 1. A traditional search is a full time job. You can't be employed doing anything else. Period. 2. You have a great deal of autonomy in traditional. Yes, you have investors, but you do not work for them. They are partners - not bosses. 3. Deals are WAY bigger in traditional. The average deal size is $16M according to 40 years of Stanford data. You will own a smaller percentage of a MUCH bigger pie. I would rather own 25% of a $20M company with no PG, than 100% of a $2M business with a PG. 4. Traditional is much harder to get off the ground and start than self-funded. There is a lot of money out there, but you still have to fundraise, and that process is challenging and time consuming b/c you have to take the time to build relationships.