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Summary
Can Self-Funded Searchers REALLY Raise MILLIONS of CAPITAL to Buy a Business? Sean Smith of Search Fund Ventures explains how its done.
Takeaways
• Search Fund Ventures focuses on self-funded searchers and independent sponsors.
• They target essential products and services for investment.
• Investment involves filling equity gaps for searchers.
• Sean emphasizes the importance of downside and upside return scenarios.
• Recent Successful deals are evaluated based on strong revenue bases and recurring revenue.
• Searcher qualifications include financial backgrounds and industry experience.
• The HVAC sector is a key focus area for their investments.
• They prioritize deals with near-term distributions for investors.
• The fund has a three-year deployment period for capital.
• Incentive alignment between investors and entrepreneurs is crucial.
Chapters
00:00 Introduction to Search Fund Ventures
02:47 Understanding Self-Funded Searchers
05:54 Investment Process and Value Addition
09:00 Cost of Capital and Return Expectations
12:02 Recent Deal Overview
15:00 Evaluating Searcher Qualifications
18:07 Commercial vs. Residential HVAC Businesses
20:55 Roll-Up Strategies and Multiple Expansion
23:54 Investor Commitments and Fund Structure
27:05 Navigating the Search Fund Landscape
30:02 Intrinsic Value and Investment Decisions
33:14 Due Diligence and Quality of Earnings
36:05 Future Goals and Investment Timeline
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