3 ms·

is this somehow different than just buying a business?

• smallegan 12y ago
  You are putting a fund together to go out and do it.
• molsongolden 12y ago
  The founder(s) usually pitch the fund to a handful of initial investors and raise a few hundred thousand to bankroll the search process (their pay, employee pay, travel and meeting funds, etc...). Once an opportunity is identified they go back to the investors and figure out how to best fund the purchase then stay on to manage/turnaround the business. It's different because they aren't usually putting their money on the line and they get paid to search for opportunities.
• cliftonk 12y ago
  IMO the author has the entire idea of why people do this wrong. If you can raise tens of millions of dollars on the idea that you will be able to buy a business and get a 3-6x ROI for your investors in a 3 year timeframe, before even identifying the acquisition target, I sincerely doubt you're in it for a temporary ego boost. It's extremely difficult to move up the ladder of a PE firm to the partner level, so often times associates/analysts will strike out on their own as a fundless sponsor or start a search fund.
  • foobarqux 12y ago
    Do you have any prominent examples of PE employees doing that? Does this happen at premiere firms?