The Search Fund Sourcing Playbook: Finding Your First Acquisition

The search fund model gives you 18-24 months to find, acquire, and begin operating a business. That timeline is unforgiving. Most searchers spend the first 3-6 months figuring out their sourcing process. That is 25% of your runway spent on process design instead of deal execution.

The Search Fund Sourcing Challenge

Search funds face unique constraints:

• Solo operator. You are the sourcing team, the deal team, and the diligence team. There is no one to delegate to.
• Fixed runway. Every month spent searching costs money. Efficiency is not optional.
• First-time buyer. Owners are evaluating you as an operator, not just as a buyer. Your outreach needs to build credibility fast.
• Narrow thesis. Most successful search funds focus on a tight vertical, which means the target universe is finite. You need to be systematic about coverage.

The Numbers You Need to Know

Based on aggregated search fund data:

• Average time to close: 18-24 months from search start
• Companies screened per successful acquisition: 1,500-3,000
• Companies contacted: 300-600
• Meetings with owners: 40-80
• LOIs submitted: 3-8
• Deals closed: 1

Those ratios mean you need to be screening 100-200 companies per month and contacting 20-40 per month to stay on pace. Most searchers fall behind because they cannot sustain that volume while also running diligence, managing investor relationships, and learning the acquisition process.

The Sourcing Stack

Tier 1: Direct Outreach (highest quality, highest effort)

Cold outreach directly to business owners. Letters, emails, phone calls. This is where your best deals come from, but it requires a significant prospect list and consistent follow-up.

Tier 2: Intermediary Network (medium quality, medium effort)

Relationships with business brokers, M&A advisors, CPAs, and attorneys who represent sellers. These deals are semi-proprietary — you are competing with the broker's other buyer contacts, not the entire market.

Tier 3: Marketplaces and Databases (lowest quality, lowest effort)

BizBuySell, Axial, SearchFunder deal boards. These are fully marketed deals with multiple buyers competing. Valuations are higher and win rates are lower.

Most successful searchers allocate their time roughly 50% Tier 1, 30% Tier 2, and 20% Tier 3. The problem is that Tier 1 requires the most time and infrastructure.

Where Ted Changes the Game

Ted operates at Tier 1 — direct, proprietary sourcing — but eliminates the infrastructure burden. Instead of spending 20+ hours per week building prospect lists, researching companies, and qualifying targets, you receive a curated pipeline of thesis-matched targets with verified ownership, estimated financials, and direct contact information.

That means you can allocate your time to the highest-value activity: having conversations with owners. Which is the only activity that actually closes deals.

Practical Tips for Search Fund Sourcing

• Start narrow, expand if needed. It is better to deeply cover a tight vertical than to shallowly cover a broad market.
• Track everything from day one. Your CRM is your memory. Six months from now, you will not remember which owners you contacted in week three.
• Follow up relentlessly. The average business owner needs 5-7 touches before they engage. One letter is not a sourcing strategy.
• Ask for referrals. Every owner you talk to knows other owners. Even if they are not selling, they might know someone who is.
• Do not ignore timing signals. An owner who says "call me in 6 months" is giving you a gift. Set the reminder and call in 6 months.