Search Funds

A search fund is an investment vehicle, conceived in 1984, through which investors financially support an entrepreneur’s efforts to locate, acquire, manage, and grow a privately held company.

The model offers relatively inexperienced entrepreneurs with limited capital resources a quick path to managing a company in which they have a meaningful ownership position.

Since 1996, CES has conducted a series of studies on the performance of search funds. CES has identified and tracked more than 500 search funds raised since 1984 in the United States and Canada. The growing cohort of international funds located throughout Western Europe, Latin America, and India are tracked by our counterparts at IESE Business School in Barcelona, Spain.

A 2022 CES analysis of 526 qualifying search funds found the aggregate pre-tax internal rate of return to be 35.3%, and the aggregate pre-tax return on invested capital to be 5.2x.

H. Irving Grousbeck

Grousbeck helped conceive of the search fund and advised many entrepreneurs who have used them. “It’s the most direct way I know for aspiring MBA entrepreneurs to get into business for themselves. And now that there are many experienced search-funders out there, those who have gone earlier are advising those who have come along more recently. Our objective is to have the search-fund model grow, flourish, and be self-supporting, as one wave helps the wave behind it.”

Featured Research

For those contemplating pursuing a search fund, or investing in one, the Center for Entrepreneurship Studies has created a practical guide to answer the most frequently asked questions.

2024 Search Fund Study

Peter Kelly, Sara Heston
The 2024 Search Fund Study reports on the financial returns and key qualities of search funds formed in the United States and Canada since 1984. This…

Long Term Hold

E870 Long Term Hold
Peter Kelly, Sara Heston
This note provides the most up to date insights on Long Term Hold.

Highlights from the 2023 Search Fund CEO Conference

Case Study

Search Fund Team Building Survey Selected Observations

Peter Kelly, Sara Heston, Andrew Freiman
This study examines the executive hiring and termination decisions of 40 search fund CEOs during their first two years post-acquisition. CEOs from…

Search Fund Studies & Cases

Related Faculty

Related Resources

Think Like An Owner
Sara Heston & Peter Kelly – Stanford Search Fund Study – Ep.131

Together at Stanford, Sara and Peter, among other projects and teaching, assemble the Stanford Search Study that has been released every year on even years.

Search Funds and Entrepreneurial Acquisitions Book Cover
Related Reading
By Jan Simon

In this book, Jan Simon, Managing Partner of Vonzeo Capital and Academic Director of the International Search Fund Center at IESE Business School, presents a best-practices-based roadmap for searchers, acquisition entrepreneurs, investors and board members.