Take Five #017: “I bought 3 companies in 6 months. Would I do it again?” and more
Codely v2.0 public release is here
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What has changed in our latest release?
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All new features available for all public channel users
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Coding collaboration with over 200 users at once
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Real-time code save every 0.1 seconds
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Take Five #017: “I bought 3 companies in 6 months. Would I do it again?” and more
1. Hot off the press: the newest Search Fund Study from Stanford is out
“On the whole, the returns and key characteristics of search funds have not changed significantly in the last two years. In this study we specify the financial returns, highlight recent trends, and present new data. In 2020 and 2021 there were 124 traditional search funds launched and 66 acquisitions made. Notably, the median purchase price increased significantly to $16.5 million in this 2022 study, and software, tech-enabled services, and general business services were the most frequent industries for acquisition in 2020 and 2021.”
Get the full report here: 2022 Search Fund Study: Selected Observations
Plus, a great series of observations and top takeaways on this report from Steve Ressler in this thread:
2. How is the LMM holding up in a bear market?
Answer: pretty well, actually.
Despite deteriorating macroeconomic conditions and a recession looming on the horizon, the lower middle market in the US remains a notable bright spot.
[…]
First, many companies in the LMM have been able to adapt their business models to changing conditions in recent years, with the pandemic proving something of a trial-by-fire period for small businesses forced to innovate on the fly. Second, financial sponsors have been increasingly able to help their portfolio companies to benefit from economies of scale. And third, they have diversified their revenue streams, which has helped to expand the scope of operations and to insulate small businesses from shocks to any one particular sector or region.
From Axial’s “LMM Remains Resilient in the Face of Recession”
3. tldr; 78% of self-funded searchers find their deals from a broker:
4. EtA and frameworks on how to think long term
On searcher’s 6 frameworks for long term thinking and how it ties in with his EtA goals:
“I have always found comfort in dreaming about the future and working backwards from those dreams to guide my short-term decisions. For me, extending my time horizon is a challenge and priority that I believe will pay off in the long run. By choosing the ETA path, I sacrificed a higher earning potential in the short run, a more exciting lifestyle, work prestige, and living in a desirable location for what I hope to be long-term benefits. While the future will be highly uncertain, I can be sure that the accelerated learning of entrepreneurship will offset those sacrifices – senior leadership experience at a young age, completing a transaction, building a culture, creating value, and much more. I hope more MBAs consider this path by extending their time horizon and the impact they plan to make in this world.”
From David LaMore’s “Thinking long term: Putting a plan in place to better others and focus on the present”
5. “I bought 3 companies in 6 months. Would I do it again?”
Great quote in the thread: “The question is: Do we want everything to break slowly or break overnight? There’s no definitive answer, it depends on who you are.”
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