What is a search fund?

9 April 2024

As a founder, selling a business is difficult and a succession plan is usually the biggest challenge of all. This is why search funds exist.

You’ve probably never heard the term “search fund” before, but that is about to change. Sibusiso Mbonambi is the Managing Partner of South Africa’s first traditional search fund, backed by local and international SME investors.

What makes this unique?

Instead of just a board seat and a quarterly meeting, the Searcher looks to acquire and operate the business, installing himself/herself as the new CEO, driving daily operations, and executing the new growth plan alongside the existing management team. This gives the seller a full exit from the business, rather than just a sale of shares.

In understanding Sibusiso’s detailed requirements for an acquisition, there is so much here for founders to learn about how professional investors view the world.

In this webinar, he took us through the characteristics of his perfect acquisition, ranging from the nature of the industry to the financials and the depth of talent in the organisation.

Connect with Sibusiso here