Self-Funded Search

A self-funded search is an entrepreneurship through acquisition (ETA) model where the searcher funds their own search for an acquisition target without raising outside capital during the search phase.

How Self-Funded Search Works

Unlike traditional search funds, self-funded searchers:

• Use personal savings or income to fund living expenses during search
• Do not raise institutional search capital
• Retain 100% ownership of the acquired business
• Often use SBA loans or seller financing for the acquisition

Advantages

• Full ownership: No equity dilution during search or acquisition
• Independence: Complete control over target selection and timeline
• Higher potential returns: All upside accrues to the searcher

Disadvantages

• Personal financial risk: Searcher bears all costs
• Limited support network: No institutional investors providing guidance
• Financing constraints: May limit deal size without investor capital

Typical Profile

Self-funded searchers often target:

• Smaller businesses ($500K-$2M EBITDA)
• Deals financeable with SBA 7(a) loans
• Businesses with strong seller financing potential