What is a search fund accelerator?

A person who wants to become an owner by buying a company has a few ways to pay for the hunt. Some use their own savings. Some raise money from investors before they start. An accelerator is a third path in between. It is an organized program that gives a new searcher structure, people and some money, so the search does not have to be done alone.

What an accelerator usually provides

Programs differ, but most offer a bundle. There is often a pool of capital that covers the searcher’s costs while they look. There are mentors who have bought and run companies. There may be shared tools for sourcing deals, templates for outreach and diligence, and access to lawyers, accountants and lenders. The aim is to shorten the learning curve for someone new to acquisitions.

What it asks in return

Support is rarely free. An accelerator or its backers will usually expect a share of ownership in whatever the searcher buys, and sometimes a say in major decisions. Some programs also ask for a commitment to follow their process or to report regularly. Read those terms closely before joining, and have a lawyer explain how the ownership and control would work after a purchase.

Questions to put to an accelerator

• What exactly is included, and what do I pay for separately?
• How is ownership shared if I buy a company, and what happens if I do not?
• Who decides on the target and on the offer, me or the program?
• Can I speak with people who have been through it?

How it fits with other routes

An accelerator is one option among several. If you are weighing it against paying for the search yourself or raising money first, how to find a business to buy and how long to expect a search to take cover the practical side of any of them.