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Today’s Rundown

• Insights of 5 years investing in search funds

• NCA’s Q4 2024 recap

• ETA at the intersection of VC and PE

• 6 deal announcements (4 search fund launches!)

• 4 career opportunities

Weekly Highlights

• Jaume Argerich, director of Aniol Family Office, shared his insights and learnings of 5 years investing in search funds:

  • When investing into search funds, stick to markets and industries where you understand local dynamics, but be open to outliers with proven leadership

  • Look beyond resumes of searchers - assess practical leadership experience and their ability to run a business

  • US/Canada search funds deliver 35.1% IRR, while the rest of the world lags at 18.1% IRR due to limited exits and smaller markets (especially in Europe)

    • If investing in Europe, adjust expectations and focus on market-specific strategies for growth

  • Search funds are gaining momentum, especially in UK, France, Germany, and Italy, but Spain's quantity and quality is declining

  • More institutional investors are pushing search funds toward traditional private equity models, leading to weaker board governance

• Novastone Capital Advisors published their Q4 2024 recap:

  • In 2024, NCA added 9 platform acquisitions, expanding the portfolio to 22 companies, representing a 80% success rate

  • In 2024, NCA launched 13 new search funds in the US and Europe

  • In Q4 2024, two deals in their Operator-Led Search Fund Program have been closed

• Joyce Mackenzie Liu, CEO of Pegafund, shared how venture capital and private equity intersects with the world of entrepreneurship through acquisition:

  • Search funds, unlike VC, which focuses on high-risk, high-growth startups, target stable businesses with cash flow and leverage PE strategies like financial engineering, but require hands-on operational improvements

  • The success of search funds depends on both finding the right company and structuring the deal effectively

    • Strong deal-making skills - quickly assessing opportunities, filtering leads, and negotiating effectively - are critical

    • Poor deal selection is hard to fix, even with strong operational skills post-acquisition

  • Unlike the US, where SBA loans provide structured financing, the UK lacks accessible debt options for small business acquisitions

    • Debt pricing varies widely (8.5%–19.5%), making it hard to structure deals with optimal leverage

  • Investors look for searchers with strong industry knowledge, deal-making experience, and a clear investment thesis

  • Building trust with business owners is crucial since their emotional attachment to their company plays a major role in deal success

  • Buying a business at a low multiple (e.g., 3x EBITDA) reduces the need for aggressive growth

  • A balanced approach - leveraging existing cash flow while implementing growth strategies - yields the best long-term outcomes

  • Search funds can create significant value by professionalizing financial management and improving operating leverage

Deal Announcements

• 🇮🇹 Alex Shin and Nicolò Fanti Rizzi, both experienced finance and operating professionals, launched Lakeview Partners, a sector agnostic search fund (link)

• 🇪🇸 Andres Garrido and Curro Fita, both experienced private equity professionals, launched Madrid-based Preludio Partners, a sector agnostic search fund (link)

• 🇵🇹 João Paulo Oliveira, a Columbia MBA graduate, launched Lisbon-based Sobreiro Capital, a sector agnostic search fund (link)

• 🇩🇪 Sönke Martens, an experienced entrepreneur and manager, launched Continuando Capital, a sector agnostic search fund (link)

• 🇩🇪 SalesTech Group, a Quadriga Capital asset and rollup of sales and marketing software solutions and digital providers, acquired Rapid Peaks, a leading agencies for strategic and creative sports marketing (link)

• 🇩🇪 Paragon Partners, a low mid-cap private equity fund, acquires DYMATRIX, a SaaS for data-driven and AI-powered customer experience management (link)

Career Opportunities

• [PE Asset] (Interim) CFO | Camino Search | London (apply)

• [PE Asset] CFO | Camino Search | Copenhagen (apply)

• [PE Asset] M&A Associate / Manager | Tim Wagner Personalberatung | Frankfurt / Remote (apply)

• [PE] (Senior) Manager Value Creation | Tim Wagner Personalberatung | Munich (apply)

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