An invaluable two-minute tip for half of you reading this. 👇 If the numbers don't make sense and the logical way to fix them would change the nature of the business entirely, it's not worth your time. Don't get suckered in - move on immediately. If you're running a search fund

Four surprising things that (almost) every small business owner cares a LOT about: 1. Staying on the company health insurance plan. 2. Keeping their company car. 3. Staying on the company cell phone plan. 4. Keeping their office at the company so they have a place to work out

Five rituals I've seen searchers use to maintain their sanity during the grueling search process: - Meditate. Take 5 minutes at the start of every day to clear your mind. One searcher I know does this right before her first seller call each and every day. - Journal. Spend 10-15

Search fund fact: employees will test your commitment on day one. My favorite example: at least one employee will ask for a massive pay raise the day you show up at the business. Without exception. If you're not ready for this, or if you're not able to deal with it, perhaps you

If you're doing an industry-thematic search, you're unlikely to find it productive to send a useless, boring, undifferentiated, cold email. That's the sort of thing a list of prospective customers might deserve after you buy a business, perhaps. But that's not for you, at this

First-time searchers often struggle as their role transitions from investor to owner. The rhythms, skills and judgment are very different.

An invaluable two-minute tip for half of you reading this. 👇 Many searchers kick the tires on businesses that: - are dramatically cyclical - have a tiny margin or - are based on one-time, non-recurring, discretionary purchases Don’t waste your time! Disqualify these businesses

As a searcher, you're not just buying a business. You're buying coffee for a lot of advisors. If you're successful in your search to find, buy and run a privately held company, you're going to end up talking to hundreds of advisors. Lawyers, accountants, bankers, investors,

Founder-led organizations always have scar tissue. Always. When evaluating a founder-owned business, you'll need to be able to see the founder's scar tissue and evaluate it clearly before you start getting rid of it. This is best learned by doing but you can create a

Your Quality of Earnings just came back. The business you had your eye on has a surprise in its year-end statements. ❌ You don't have to kill your deal. But you can't ignore it either. Two simple strategies: - Keep a portion of the purchase price in the hands of the seller.

There's a simple exercise I recommend to folks who are in the final stages of drafting their search fund PPM. 👇 Find three brokered small business CIMs and print them out. Now, crumple up and throw away the first ten pages of fluff (e.g., executive summary, key risks /

The unlikely choice My favorite searchers are the ones who, each time they had to make a career decision, pushed against the obvious, easy one in order to find a worthy alternative. Sometimes that looks like joining a hedge fund instead of staying at McKinsey. Sometimes that

Businesses with great EBITDA margins usually have great contract structures. While businesses with low EBITDA will inevitably have bad contracts. And a business with bad contracts that still makes a ton of money... is one to watch out for. 🚩

Deal scorecards and spreadsheets are essential if you're in the business of running a search fund. But that doesn't mean they're sufficient. If you're at the bottom of a giant spreadsheet calculating the ROI on a particular company in Detroit with a ten-year hold, it might be

Daniel Huf is the founder and managing partner of Hevesta Capital. He wants to make a significant investment in one New Mexico business and then dedicate his career to it. bizjournals.com/albuquerque/ne…

First-time searchers are routinely unprepared for the amount of work involved after an LOI is signed. And the window they have to do all the fact-finding and complete all purchase agreement-related items is disorientingly small. Three months at the outset seems like forever

When is it time to go full-time on a search fund? When you’re first getting started, it’s tempting to moonlight, to invest a few hours a week in your search fund and simply let it unfold. But it turns out that in the early days, many of the people you need to meet with and the

The search fund process is a grind. It's a grind that requires a lot of repetitive, low-leverage work. But it doesn't have to be done only by the people who are going to close the deal. Build a team around you - interns, Upworkers, whoever it might be - so that you're not trying

Expert calls for search fund entrepreneurs Like every other aspect of your search, you get to learn how to learn. When you need to learn about a new industry, the temptation is to hop on a Tegus call or contact your one acquaintance in the industry who knows it backwards and