A search fund is a financial buyer structure where one or two principals (the searchers) raise capital from a small group of investors to fund a search for a single business to acquire and operate. The searcher then takes an operating role (typically CEO) post-acquisition, with the investor base providing equity for the deal itself.
Search funds are an emerging category in Australia, with a growing community of around twenty active and recently-completed searchers backed by groups including Dorado Capital, WayFinder Capital, and SMEVentures. Search fund deals in Australia typically target businesses with $1M to $5M in EBITDA, with deal sizes from $5M to $30M.