Does it really make sense to wait until you save up the money to do a self-funded search? If it takes another 2-3 years, isn't that a huge opportunity cost? Obviously, you theoretically get more of the business in a self-funded search, but I think there is a lot of value in buying bigger (eg, can potentially hire a new CEO down the road, stay on as chairman, and repeat the whole process with a new biz).
Also, if you buy a bigger business with the right backers, isn't it possible to avoid signing a personal guarantee? eg, for a $3m EBITDA business, you may just get traditional bank financing and, if the bank trusts you and your backers, avoid the PG. Does anyone have any thoughts on this specifically?
Traditional vs. Self-funded
by a searcher from University of British Columbia - Sauder School of Business
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Depends on what deals you are going into - having investors give you more leverage.
Also if investors are not invested, then they have less onus to help/guide/connect you to opportunities.
On a personal finance level, have to consider how long your runway is and what do you do after if you deplete all your reserves.