Search funds are often sold as the fast-track path to entrepreneurship. Raise a modest pool of capital, find a small but profitable company, take the reins as CEO, and create life-changing wealth. On paper, it looks elegant. In reality, itʼs far more brutal than most aspiring searchers care to admit.

Let’s start with the hard numbers. Since the 1980s, Stanford has tracked over 681 U.S. and Canadian search funds. About 63 percent have acquired a business. Stanford’s 2024 study reports 328 U.S. search fund acquisitions: 122 exited with positive returns, 40 exited with negative returns, and 166 continue operating their companies. Globally, 146 international acquisitions have taken place, but just 21 have reached exit, and only 15 produced positive returns. Most searchers remain early in their holding phase. The model is designed for long-term ownership rather than quick flips, so it is not the right path if your goal is a fast exit.

Stanford’s data also shows 37 percent of searches never acquire. Of those that do, about 31 percent lose total or partial capital. In total, around 50 percent of all searches end poorly. Internationally those numbers are slightly higher, but with a much smaller data set. Ultimately this is the brutal reality for a process that initially consumes two, plus another five to ten years in the acquired company.

And geography matters. The United States has a robust ecosystem of experienced investors, and lenders familiar with the model. Europe is still in its infancy, characterized by a smaller yet fast growing investor base, more scattered support networks, and seller skepticism. Asia? Effectively non-existent.

Then thereʼs the psychological weight. Search is binary: you either buy a company or you donʼt. Months of near misses grind you down. Under pressure, many rationalize mediocre deals just to close, which is often a fatal mistake. And operating the business? Most searchers come from consulting, finance, or MBA classrooms. Walking into a factory with 50 employees is a different world. Spreadsheets wonʼt save you; trust, grit, and people leadership will. Thatʼs a crash course few are prepared for.

But if you understand the odds, accept the grind, and are motivated by the chance to own and operate a real business, then the search fund path can still be one of the most meaningful ways to build long-term value. Next week we will highlight the (right) reasons to start a Search Fund.

Completed Fundraise:

Milan-based Vela Equity Partners, led by Guido Emanuele Fucci (ex-Saipem, ex-Ambienta), has launched its search with strong investor backing. Guido is seeking to acquire and grow an Italian SME in a resilient, fragmented sector with consolidation potential.

Transactions:

Tübingen-based Konkordia Unternehmensnachfolge, founded by Daniel Missethon and Wolfram Krauss, has acquired Essen-based KKD GmbH, a leading fleet services provider in Germany. 

Stockholm-based Black Fox Invest, led by Kristoffer Ekelund, has acquired Tollco AB, a Swedish manufacturer of water damage prevention products with a strong international footprint. Former CEO Clas Crafoord Olsson remains involved to support brand development.

Vienna‑based search fund Lacus Legacy, founded by Paul Szyszkowitz (ex‑Bain) and Christoph Siegesleuthner (ex‑Rothschild & Lyvia), has acquired Pharmacom Handels GmbH and Binder Pharmaservices GmbH, leading providers of direct‑to‑pharmacy pharmaceutical distribution, data insights, and medicine‑tracking services across Austria.

Alfie and Toby dissect a North West UK logistics business with £2.5M turnover,£700K gross profit, and a £1M asking price (ex-assets). They unpack valuation red flags, owner-dependence, and the risks/rewards of diversification across training, haulage, and warehousing. A sharp look at how searchers should approach listings that seem attractive on paper but hide structural challenges.

Spain has emerged as Europeʼs hottest ETA exit market. Over the past 12 months, the country has seen a record wave of successful search fund exits, including

Ctaima, Bike Ocasion, Vozitel, and several others, marking a sharp acceleration compared to just a handful in prior years. The trend underscores Spainʼs consolidation momentum and shows the SF model is now delivering consistent institutional-grade returns in Europe, much like in the U.S. 

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