Choosing an Uncommon Investment Career Path

If you had told me that that I would be starting a search fund after graduating from Wharton in 2013, I would have thought you were crazy. Actually, I probably would have asked you what a search fund is, and then told you that you were crazy. Why would an MBA graduate forgo other lucrative career opportunities to start a search fund? What motivates one to choose a path that is filled with uncertainty and ambiguity? Is the search fund model even real?453296725

I first heard of the search fund model in my first year at Wharton, but my journey on this career path started with my first corporate job. As a consultant with one of the top global information technology companies, I quickly realized that the corporate world wasn’t able to offer me the experience and growth that I was looking for. To become a strong business leader and gain experience growing businesses, I knew I had to develop my skills by taking ownership of business lines and delivering results. Fortunately, I had worked with a small business in the past and was very successful in helping it grow. That experience motivated me to leave my corporate job to join the First MicroFinance Bank, which provided capital to consumers and small businesses.

In my new role, I was extremely fortunate to work with and learn from an experienced and highly accomplished CEO that had built his career with a major global bank. Although my primary goal was business and product development, I quickly became the CEO’s right-hand man and was active in almost every aspect of the bank’s daily operations. Despite our success in launching new products and growing our portfolio, I decided to pursue an MBA to continue building on my strengths and expanding my skillset in running a business.

Coming into Wharton, I wanted to continue working with small businesses, but I was not sure how I would be able to do that in a meaningful way. After turning down several opportunities to work in traditional post-MBA roles, I heard about the search fund model during an Entrepreneurship Through Acquisitions class discussion and was intrigued. The model, at its core, involves working with a group of investors to locate, acquire, manage and grow a privately held business. The “searcher” starts by raising funds from a group of investors and then spends two to three years looking for one special business to acquire and grow. After finding the right business, the searcher is expected to take on a management role at the company and relocate to the business’ headquarters. One of the key differences between the search fund model and traditional venture capital and private equity funds is that the search fund model is focused on the business owner and is designed to provide a unique transition plan to take the business to the next level.  A classic search fund case is Asurion: a car-towing company that was bought for about $6 million by two searchers in 1995 and has grown to an insurance giant valued at over $2 billion today.

Despite my initial curiosity, I wasn’t convinced that the model was for me. I was excited for the opportunity to work closely with a business owner to grow his or her business, but I also knew that the odds were against me as many searchers have gone several years without finding the right business. However, it was during my second year at Wharton on the leadership venture in Antarctica that I found the strength to go for it.

“Life is too short to be putting your passion on hold,” I told myself as I was inspired by the natural beauty of the most inhospitable continent on the planet.

After graduating from Wharton, I spent six months on the road selling myself and my vision to investors throughout the country. This time, it was the investors that thought I was the crazy one.

“Why are you doing this?” they often asked, which was a question I would also ask myself numerous times on those long road trips.

Although the financial incentives can be highly rewarding for a successful searcher, the answer boiled down to one thing: my passion for working with small businesses to develop their employees, culture and community. After seeing many owners struggle with a succession plan, I grew frustrated with the lack of options available to them and decided to put together a fund that would cater directly to their unique needs and provide a long-term plan for the future of their businesses.

We started GreenStreet Growth Management in April of this year with a talented group of investors comprised of wealthy individuals, family offices and small PE firms. Since then, I’ve been busy looking at various industries and speaking with business owners throughout the country. In addition to working with a highly accomplished group of investors, I’m also very excited to start applying some of the skills I gained at Wharton to take a small business to the next level.

The purpose of this blog, which will chart my search journey, is to create awareness for business owners, investors and operators about the search fund model. This journey is not for the faint of heart as there have been and will undoubtedly be many highs and lows along the way. We are not just looking to invest capital, but rather to partner with a business ready to open a new chapter and benefit from what we have to offer. If you want to learn more about us, please feel free to visit our website www.greenstreetgm.com and return to this blog for more updates.

 

 

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