The top self-funded search fund investors in 2023
By Mainshares
May 1, 2023
In Buying a Business
Finding an investor for your small business acquisition can be challenging. Despite small businesses having been around since humans began trading with one another, investing into SMB acquisitions is still a relatively young and opaque asset class.
When considering raising capital to buy a business, searchers will find four types of investors who can fund a business acquisition: friends and family, angel investors, search investing syndicates and managed funds.
At Mainshares, we work with entrepreneurs who leverage all types of investors for raising capital to buy a business. In this post, we’ll highlight the top funds, syndicates and angel investors for self-funded SMB acquisitions in 2023.
Top Funds for Self-funded Searchers
A fund is an investment vehicle where individual investors make a capital commitment to a fund and defer to the fund’s investment committee or general partner (GP) to make individual investment decisions. Below are the top funds for self-funded search entrepreneurs.
Fund | Background | Average Check Size | Investments in Last Year |
|---|---|---|---|
Slack Water Capital is managed by Ben Bortner, who is a former searcher and operator who has successfully exited. Slack Water Capital provides equity gap funding to self-funded searchers acquiring an SMB to own and operate full-time. | $300K - $1M | 5 | |
Workbench Capital is an investment group led by Tony Cappaert. The group focuses on self-funded search deals and is funded by over a dozen operators. | $150K | ~10 | |
SIG was formed to support entrepreneurs to acquire, own and build great companies. They market themselves as a highly experienced partner who can assist with diligence, deal reviews and tactical support. | ~$5M | ~7 | |
Feta Fund is predominantly an investment vehicle for traditional search funds but will write smaller checks into self-funded acquisitions. The fund is run by Saumil Jariwala. | $1M+ | 10+ | |
Fruition Capital is a new fund focused on self-funded search entrepreneurs. They target B2B acquisitions with over $750K of EBITDA and a diversified base of repeat customers. | N/A | N/A | |
This vehicle is a family office that is pretty flexible in the opportunities they will consider. The office prefers to invest after a lead has already been secured. The office is managed by Bradford Hardin. | $25K - 200K | N/A | |
RCR is a family office based in the Tamp area. They will be deploying capital for the next 6 months. The office is managed by Chris Graham. | $50K - 250K | N/A | |
LP First Capital is an investment firm focused on founder-led and family-owned businesses. The firm makes investments in self-funded search entrepreneurs as well. | ~$10M, although smaller for self-funded searchers | N/A |
Top Investing Syndicates for Self-funded Searchers
Unlike a fund, where investors commit capital to a pool managed by a GP, a syndicate is a loose collection of investors, where each investor opts in to each investment brought to the table. Depending on the structure, sometimes there is a syndicate lead who is responsible for sourcing and vetting deals. That lead gets performance-based compensation depending on how the deals he or she brings forth perform.
We are only aware of one syndicate in the ETA space, which is CVA Investment Management. This syndicate is composed of entrepreneurs and investors. Their involvement ranges from being a silent partner to taking an active role and board seat in the acquired company. Their average check size ranges from $100K to $750K.
Top Angel Investors for Self-funded Searchers
Angel Investor | Background | Average Check Size | Investments in Last Year |
|---|---|---|---|
Former VP of Sales at 2 high growth and acquired startups. David searched for and acquired a private vineyard management company several years ago and has scaled it over 5x. He is now a dedicated self funded search investor. | $100 - $250K | 9 | |
An investment vehicle run by Ben Tiggelaar that focuses on independent sponsors and self-funded search entrepreneurs. | $75 - $150K
| 4 | |
Sam is a seasoned ETA entrepreneur. He founded Pursuant Capital, a holding company in Florida, SMBash – the SMB investing conference, as well as SMB Law Group. | N/A | N/A | |
Chris is currently an SMB operator in industrial services after completing a self-funded partner search. | $25K - $200K | N/A | |
Gregg is a hybrid self-funded searcher and investor. He focuses on US-based self-funded searchers acquiring customer facing businesses. Background is primarily in customer operations and strategy. | $100K - $200K
| N/A | |
Jason is a self-funded searcher with 30+ investments in SMBs across a variety of sectors. He recently exited his first platform in the home services sector (SE FL). Although his normal check size is on the smaller end, he’s open to writing a larger check as a deal partner with a roll-up strategy in the home services sector. | $25K - $75K | 10+ | |
Kausutbh is a former PE investor turned self-funded searcher who acquired a tree care business in Seattle. He’s interested in supporting searchers working on tree service deals (away from Seattle metro), either as an investor or an industry guide. | N/A | N/A | |
Max is a former M&A banker and technology entrepreneur (sold company to LendingTree). He’s currently building a portfolio of SMBs and investing in operators. | N/A | N/A | |
Rich is a former Marine turned business operator through ETA. He owns and operates plumbing and HVAC companies in the Northeast. | N/A | N/A | |
Richard is open to investments anywhere in the US. He avoids turnaround or startup investments and prefers B2B. B2C companies are fine, if they are in the trades or home services sectors. | $100K - $300K | N/A |
Final Thoughts
This list is by no means comprehensive. With growing interest in Entrepreneurship through Acquisition (ETA), more people are raising funds and forming syndicates each day.
Know of an investor that belongs in our list? Send us an email at support@mainshares.com and we’ll make sure to add them!
Information posted on this page is not intended to be, and should not be construed as tax, legal, investment or accounting advice. You should consult your own tax, legal, investment and accounting advisors before engaging in any transaction.
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