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Today’s Rundown

• Yale on dos and don’ts of search fund investors

• INDUS Holding FY24 results and guidance

• 6 deal announcements (4 search fund announcements!)

• 7 career opportunities

Weekly Highlights

• Yale School of Management published a paper on what exactly search fund investors do and don’t do for entrepreneurs:

  • Search fund investors primarily provide capital in two phases - initial “search” funding and later acquisition financing - alongside valuable signaling and credibility for the entrepreneur

  • They offer critical non-financial value, particularly through pattern recognition from past investments, helping entrepreneurs assess deals, conduct diligence, and navigate early operations

  • Investors frequently occupy board seats, contributing to both governance and strategic advisory roles, although entrepreneurs should manage expectations about who exactly will serve

  • Mentorship is a hallmark feature of the relationship, with seasoned investors guiding entrepreneurs through challenges without micromanaging day-to-day operations

  • Access to the ETA community is a unique benefit, where investor affiliations open doors to events, networks, and peer insights that are otherwise difficult to penetrate

  • Investors extend their proprietary networks, facilitating introductions to service providers, co-investors, and industry experts - but entrepreneurs must use this access judiciously

  • There are clear boundaries to investor involvement: they typically do not source deals, acquire customers, or run operations, as these are squarely the entrepreneur’s responsibilities

  • Investors do not guarantee job security - entrepreneurs can be replaced if underperforming - nor are their financial interests always perfectly aligned with the CEO’s over time

  • Acquisition capital is not guaranteed, even from initial search fund backers; investors reserve the right to pass on deals, making ongoing engagement and persuasion essential

  • To thrive, the entrepreneur–investor relationship requires mutual effort, with entrepreneurs managing expectations, taking the lead, and making targeted asks, while investors can add value by being more available and reducing conflicts of interest across portfolio companies

• INDUS Holding, a holdco of a diversified portfolio of German SME companies, published their FY24 results and guidance:

  • INDUS Holding focuses on buying and growing SME businesses with unique engineering capabilities in niche markets

  • INDUS Holding reported FY24 sales of €1.72 billion, down 4.5% year-over-year, but this was seen as solid given a difficult macroeconomic environment

  • Free cash flow stood out at €135 million - significantly better than expected - demonstrating strong cash generation

  • With a current share price of €25.55 and a target price of €34.00, there's an implied upside of over 27%; both DCF and adjusted FCF models indicate fair values well above the current market price

  • A dividend of €1.20 per share was proposed for FY24, unchanged from the previous year; based on the current share price, this equates to a yield of nearly 6%, offering attractive returns to shareholders

  • INDUS Holding plans to invest €500 million in acquisitions by 2030, targeting companies with revenues between €20–100 million; the focus will be on Infrastructure, Materials Technology, and Technology & Innovation segments

Deal Announcements

• 🇬🇧 Carlos and Kathryn Arrebola launched husband-wife search fund Norte Partners, focused on people- or environment-related businesses (link)

• 🇳🇴 Maja Zhang Olsen and Halvor Berg launched search fund Fram Capital (link)

• 🇮🇹 Francesco Valli launched search fund Nostos Capital (link)

• 🇮🇹 Antonio Garufi and Angelo Sacca launched search fund Eolo Capital, focused on industrial businesses (link)

• 🇩🇪 Communardo Group, a Bregal Unternehmerkapital platform and a full-service provider for modern workplace solutions, acquired celix Solutions, a Atlassian specialist (link)

• 🇩🇪 fiskaly, a Verdane asset and intelligent SaaS cloud solutions for complex fiscalization requirements, acquired DF Deutsche Fiskal, a wholly-owned subsidiary of GK Software SE and focused exclusively on the topic of fiscalization (link)

Career Opportunities

• [PE-Asset] Interim CFO | Stanton House | Remote (apply)*

• [PE] Head of Portfolio | Linear Partners | Frankfurt (apply)*

• [PE] Fund Finance Director | Camino Search | Frankfurt (apply)*

• [PE] Senior Investment Associate / Investment Manager | BLR Capital | Zurich (apply)

• [PE] Investment Associate Growth Equity | Armira Growth | Munich (apply)

• [PE] Investment Associate | Summa Equity | Stockholm (apply)

• [PE] Investment Intern | Syntagma Capital | Paris (apply)

_*Headhunter

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