Top 3 challenges as a Searcher?

professional profile

August 21, 2021

by a professional from Southern New Hampshire University in Boston Metropolitan Area, USA

Hello Searchers!

I often hear "finding good/great companies that are for sale". I'd like to better understand what are the other challenges you face as you navigate the Searcher Horizon. There is no better way for understanding this better than asking the Searcher Community.

Many thanks!

5
5
127
Replies
5
commentor profile
Reply by a searcher
from Columbia University in Jacksonville, FL, USA
Sourcing, Sourcing, and Sourcing. I am not a hyper-experienced private equity investor, but I have a lot of experience investing in value-type public equities and have read everything about Buffett's moats, Greenblatt's Magic Formula, Graham's Net Net's, Klarman's cigar butts, etc. A long time friend of mine that is a MD at a Billion dollar fund said holds true, if a deal is good, money becomes a commodity. Fortunately, at these small levels, deals are more abundant and you can create value by putting in a lot of your own sweat equity and ingenuity. But I would still say sourcing is the most difficult part. You aren't going to find a huge moat, but you can create one by market segmentation or brand equity or some other operational implementation.
commentor profile
Reply by an intermediary
from University of Missouri in St. Louis, MO, USA
As someone who has represented sellers for the last 30 years, a deposit should not be required by the seller or advisor with an LOI. The purpose of an LOI is to put the buyer's thoughts on paper for the seller to review and respond. I don't care, and the seller shouldn't care, if you put some small dollar amount in escrow that is fully refundable. I would rather see as an exhibit to your LOI a recent bank or brokerage statement with 10=20% of the transaction value in liquid funds.
commentor profile
+3 more replies.
Join the discussion