An in-depth conversation with good friends Casey Schuler and Hutson Prioleau who, in late 2019, acquired PalCare, a healthcare technology company that powers nurse-call systems for assisted living and memory care communities. That's when the real pain began.  What began as an exemplary Entrepreneurship-Through-Acquisition (ETA) investment quickly turned into a crisis when COVID-19 disrupted senior living facilities across the country. Within three months of the close of its acquisition, 80% of PalCare’s projects came to a halt as care facilities locked down. However, the duo's complementary strengths—Schuler’s operational rigor and Prioleau's sales chops—helped them prove PalCare's resilience. Working (and commuting) side by side, Casey and Hutson stabilized the business, cut costs, and automated their systems. Today, the company stands as a preeminent healthcare technology platform in senior care. In conversation with Search Party host David Snow, joined by Dustin Sellers, Managing Partner of Next Coast Legacy and August Felker, Founder of Oberle Risk Strategies, Schuler and Prioleau reflects on their journey from MBA classmates to stress-tested CEOs—and the lessons learned along their ETA journey. Some takeaways:  Partnership is power.  Schuler and Prioleau's experience confirmed the power of two. As Sellers notes, “When partnered searches work, one plus one equals four.” The duo’s trust in one another and delegated strengths proved decisive when “the worst-case scenario” hit. Operator-market fit matters more than margins. Early in their search, the pair passed on seemingly lucrative opportunities in industries they couldn’t see themselves running. “What’s your life going to look like for the next half decade?” Prioleau says, and “does this business need the skillset that you have?” Resilience beats timing. COVID put their company to the ultimate test, but it also proved the value of Palcare. "Even if everything goes to hell, people are not going to rip out their emergency nurse call systems," notes Schuler. Now, with a new COO and CRO in place, the founders are shifting from survival to scale—spending more time on culture, vision, and how AI might redefine senior care technology. “Let's keep growing a great business,” Schuler says. “Exit will take care of itself.” Follow Search Party on LinkedIn:  https://www.linkedin.com/company/search-party-channel/ Search Party Lead Sponsor:Next Coast Legacy https://lnkd.in/eSAuRW5p Search Party Sponsors:Avidbank https://www.avidbank.com/Boulay – Contact Boulay's Search Fund Team: https://lnkd.in/eFF88SVfOberle Risk Strategies https://oberle-risk.com/Plexus Capital, LLC Capital https://plexuscap.com/

In the middle of COVID, when parking-garage volume was down 80%, Diego Cuenca, the first-time CEO of a parking garage tech platform called TickeTech, was feeling beat up.   Having acquired TicketTech just months earlier as part of an Entrepreneurship-Through-Acquisition (ETA) search-fund investment group, Cuenca was beginning to have visions of himself as leading “one of the worst search-fund outcomes in history,” he tells Search Party.   Fortunately, Cuenca had a background in both entrepreneurial and fighter perseverance. In his darkest moment - while hand-delivering tickets to empty garage clients - Cuenca, a former wrestler and mixed-martial arts (MMA) athlete, remembered advice from his coach: Just score the next point.   The TickeTech investment ended up becoming a success notable enough that Columbia Business School now has a case study on it. In this Search Party episode, Cuenca, now a second-time ETA searcher looking to acquire a business with high-quality revenue, shares his TicketTech story with Katie Walker, Principal at Plexus Capital, Tatiana Gaspar, a Director at Next Coast Legacy and host David Snow.   Among the key takeaways of this fascinating conversation:   Revenue quality beats everything. After guiding Ticketech through crisis and exit, Cuenca says his next search fund is centered on one principle: “The biggest lesson from TickeTech is revenue quality.” His fixation on recurring, durable cash flow reflects his realization in the wake of TickeTech turnaround that the company was saved by high-quality revenue.   Understanding the business before the balance sheet. Before ever studying accounting, while living in the Philippines as a child, Cuenca says he learned about cash flow from his Filipina mother businesswoman, who made him tag along to collect rent. “I think I understood yield very early,” he recalls. That grounding in practical economics later gave him a unique feel for operational risk and opportunity—skills that proved invaluable as a CEO.   Don’t chase someone else’s thesis. Early in his search career, Cuenca admits he “chased after the winds of the past,” following sectors that had already yielded investment successes, rather than overlooked sectors primed for growth. He now believes true advantage comes from differentiated focus: “It gives you a distinct advantage coming in as a new CEO.”   Follow Search Party on LinkedIn: https://www.linkedin.com/company/search-party-channel/   Search Party Lead Sponsor: Next Coast Legacy https://lnkd.in/eSAuRW5p   Search Party Sponsors: Avidbank https://www.avidbank.com/ Boulay – Contact Boulay's Search Fund Team: https://lnkd.in/eFF88SVf Mayer Brown https://lnkd.in/gU7sPPSg Oberle Risk Strategies https://oberle-risk.com/ Plexus Capital, LLC Capital https://plexuscap.com/

Entrepreneur Henrique de Freitas is barely a year into his ETA journey, and he's already the CEO of a lower-middle-market business-process outsourcing company called Reliable Premium.  De Freitas tells Search Party the founder of Reliable Premium " built the business over 20 plus years. It had grown into something bigger than he probably ever imagined it could, and it turned out to be a win-win - a liquidity event by somebody who would take care of the people and the culture and the legacy." De Freitas, a native of Brazil, says he worked in investment banking and private equity after moving to the US. But then he "started learning about search, about the model. I was tremendously impressed with the world-class people who were doing it, both CEOs and investors, and how welcoming they were." When de Freitas came across Reliable Premium Management after a six-month search, he realized it checked all of his search boxes: it provided a solution for small businesses, and it was growing more quickly than the founder had anticipated. Bringing his expertise in technology, de Freitas knew he could help it scale up. Now, seven months into his role as CEO, de Freitas has helped Reliable Premium Management reach about 10,000 small businesses. In this episode of Search Party, de Freitas explains the mindset that has helped him succeed on his “entrepreneurial journey.” Follow the Search Party video-podcast on LinkedIn: https://lnkd.in/gPiiSkDR Search Party Lead Sponsor:Next Coast Legacy https://lnkd.in/eSAuRW5p Search Party Sponsors:Avidbank https://www.avidbank.com/Boulay – Contact Boulay's Search Fund Team: https://lnkd.in/eFF88SVfMayer Brown https://lnkd.in/gU7sPPSgOberle Risk Strategies https://oberle-risk.com/Plexus Capital, LLC Capital https://plexuscap.com/

Artificial intelligence has reached the lower-middle-market, as seen in the case study of Haley, an AI agent deployed by Entrepreneur-Through-Acquisition (ETA) Tyrel Sulzer to win customers for his commercial driving school, TransTech. In a fascinating conversation with Search Party, TransTech co-CEO Sulzer and his investment partner, Dustin Sellers, Managing Partner of ETA private equity firm Next Coast Legacy, share details of Haley's rapid implementation, and how the AI agent has transformed the sales function of North Carolina-based TransTech.  In a recent week, Haley, programmed with a slight southern drawl and "aw shucks" charm, exchanged 16,000 text messages with potential customers, as well as 300 voice calls. Over that time, Haley's lead outreach enjoyed a staggering 66% response rate.  Most real people to have interacted with Haley, including Sellers, couldn't tell she was an AI agent. "It's working. . . it's not clunky," says Sellers.  Among the episode highlights: Having developed a reputation as a technology laggard, the lower-middle-market is now rapidly adopting AI-powered tools to transform business functions, including sales-qualification outreach. " If you're not using technology in the lower middle market, um, you're likely gonna get left behind," says Sellers, who estimates that platforms like Haley may add 100 to 200 basis points to a company's bottom line.  Sulzer set up Haley in a single afternoon after learning from a friend that the same technology had outperformed a human sales team.  As TransTech grows and scales, Haley is facilitating greater revenue-per-internal employee, and important metric of success. Haley has exhibited great ingenuity in responding to customer requests, but at one point had to be programmed to not surreptitiously change identities as a sales tactic.  Follow the Search Party video-podcast on LinkedIn: https://www.linkedin.com/company/search-party-channel Search Party Lead Sponsor:Next Coast Legacy https://lnkd.in/eSAuRW5p Search Party Sponsors:Avidbank https://www.avidbank.com/Boulay – Contact Boulay's Search Fund Team: https://lnkd.in/eFF88SVfMayer Brown https://lnkd.in/gU7sPPSgOberle Risk Strategies https://oberle-risk.com/

Curt Black, CEO of a growing SaaS business, was a successful Google executive before deciding to pursue the path of Entrepreneurship-Through-Acquisition. His ETA journey introduced him to the founder of Aproove, who agreed to be acquired by Black and partners, then called the whole thing off.  Black finally managed to acquire the Aproove business in January 2025.  Through deal-search twists and turns, Black tried to differentiate himself as leader with a talent for solving SaaS go-to-market challenges, he tells Search Party. His search put him in contact with many successful SaaS CEOs, some of whom were looking for expansion ideas instead of exit events. Some highlights from Curt Black's conversation with Search Party's David Snow: • From Google sales to ETA operator. After nearly a decade at Google, Black leveraged his SaaS sales and management background to pursue ETA search. He built a search focused on software companies where technical founders needed commercial leadership. "My thesis was always, if I could find a good product, a good team and a founder who was more technically oriented, I could be the right person to lead that company moving forward." • The deal process paused and stalled before "boomeranging" a few months later. Black first connected with the Belgium-based founder of Aproove Work Management in late 2023, and discussions stretched over a year. In mid-2024, the process paused and both sides walked away. "A couple months later we got back together and we both decided this was a great fit for the future of the company." • Younger SaaS founders require a different ETA approach. Unlike aging Baby Boomer business owners often targeted by ETA searchers, Aproove's seller was a technical founder still interested in staying on as CTO. "The best sellers that I encountered were not as old as you might think," says Black. • ETA requires resilience when pipeline dries up. During the pause in negotiations, Black faced the uncertainty that haunts many searchers late in their funded search window: "I underestimated how challenging it can be. Some of the weeks you don't have deal pipeline. There’s a lot of lows in ETA that you need to have the grit to push through." Follow the Search Party video-podcast on LinkedIn: https://www.linkedin.com/company/search-party-channel Search Party Lead Sponsor:Next Coast Legacy https://lnkd.in/eSAuRW5p Search Party Sponsors:Avidbank https://www.avidbank.com/Boulay – Contact Boulay's Search Fund Team: https://lnkd.in/eFF88SVfMayer Brown https://lnkd.in/gU7sPPSgOberle Risk Strategies https://oberle-risk.com/Plexus Capital https://plexuscap.com/

A board of directors should hold the CEO accountable and evolve with the company's growth, say veterans of lower-middle-market business building. In a conversation with Search Party, Megan Webster of law firm Mayer Brown, Max Artz of Peterson Partners and Anthony Walker of Next Coast Legacy share observations about the positive impact a board can have on a lower-middle-market business, and the challenges the Entrepreneurship-Through-Acquisition community faces recruiting board members in a market where top talent is "stretched thin." Among the key takeaways of the Search Party episode, "Building a High-Impact Board in a 'Stretched-Thin' ETA Market:" • As demand for experienced, value-adding board members has expanded across the growing ETA community,  the supply of these high sought after individuals has not kept pace, and so ETA investors are having to get creative in sourcing board members from non-traditional backgrounds. • The right board Isn’t a checklist — it’s a strategic fit. ETA searchers-turned-CEO often seek a mix of roles—industry expert, advisor, peer—but risk treating board building like a shopping list. Peterson’s Max Artz warns against overly rigid templates: “It’s not so much like you can go into a supermarket of board members.” Instead, CEOs should prioritize accountability and character: “I want directness, I want honesty…folks who are gonna hold me accountable.” • Independent board members bring balance and experience. While capital partners often dominate ETA boards, independent members can offer crucial objectivity. "Independent directors are a wealth of knowledge,” says Mayer Brown's Megan Webster. These independent board members "bring independent viewpoints that are outside of management...and shareholders.” These experienced outsiders can help CEOs navigate crises and maintain long-term perspective. • Strong boards evolve with the business. Value creation demands different capabilities at different phases of the hold. As Anthony Walker explains, “Our first few board member meetings are usually spent aligning on what are the key leading and lagging performance metrics.” Later, boards become instrumental in strategy shifts, M&A, and exit planning—requiring members to adapt their focus alongside company growth. • Effective boards require clear communication and trust. Early-stage CEOs may overwhelm boards with minutiae or rely too heavily on retrospective reporting. Artz cautions, “What they should be doing is focusing on the future, being more strategic.” Anthony Walker echoes the need for interpersonal rapport: “We're going to have difficult conversations...you're able to have those more seamlessly when there is a relationship.” Follow the Search Party video-podcast on LinkedIn: https://www.linkedin.com/company/search-party-channel Search Party Lead Sponsor:Next Coast Legacy https://lnkd.in/eSAuRW5p Search Party Sponsors:Avidbank https://www.avidbank.com/Boulay - Contact Boulay's Search Fund Team: https://lnkd.in/eFF88SVfMayer Brown https://lnkd.in/gU7sPPSgOberle Risk Strategies https://oberle-risk.com/Plexus Capital https://plexuscap.com/ #M&A #search #privateequity #eta #searchfund #insurance

A decline in email response rates is forcing deal searchers to be more creative, says Entrepreneur-Through-Acquisition searcher Christine Koval, currently on the hunt for a lower-middle-market, back-office services business to acquire.  In an interview with Search Party, Koval notes the increasing competition to find deals in the vast US lower-middle-market, as well as the ubiquity of powerful business-outreach platforms that help deal searchers discover and contact business owners. The problem is, as every searcher has become armed with turbo-charged sourcing capabilities, business owners are becoming so inundated with inbound interest, their response rates have begun to plummet, requiring searchers to revert to pre-email methods, like cold-calling. “It is back to the olden days a little bit where your boots are on the ground, you're getting out there to learn, you're getting your face in front of business owners,” she said. Among the key takeaways of Koval's interview: Email outreach is fading—searchers must build in-person, personalized relationships. Koval emphasizes that email has become commoditized as more searchers adopt AI-enhanced bulk outreach, lowering reply rates and forcing a return to personal, high-effort engagement.  ETA differentiation has diminished—searchers must now sell themselves, not just the model. As many pockets of the lower-middle-market M&A landscape becomes saturated with investors, ETA searchers can no longer rely on the novelty of their model to stand out. “Just selling the alternative to private equity isn’t a differentiator anymore,” says Koval. “So I focused on, where do I have a unique insight or what are the industries that I've worked in my past career where I can draw an initial connection with that business owner.” A compelling personal brand is now critical for effective deal sourcing: With searchers facing lower response rates and heightened competition, Koval has embraced thought leadership, podcasts and LinkedIn as essential tools for building trust before a first call. “As search continues to evolve, think of yourself as a personal brand,” she says. “You need a unique value proposition. You need to be different, and you want owners to get to see that as early as they can in the process.” Follow the Search Party video-podcast on LinkedIn: ⁠https://www.linkedin.com/company/search-party-channel⁠ Search Party Lead Sponsor:Next Coast Legacy ⁠https://lnkd.in/eSAuRW5p⁠ Search Party Sponsors:Avidbank https://www.avidbank.com/Boulay - Contact Boulay's Search Fund Team: https://lnkd.in/eFF88SVfMayer Brown https://lnkd.in/gU7sPPSgOberle Risk Strategies https://oberle-risk.com/Plexus Capital https://plexuscap.com/

Professionalizing the finance function of a lower-middle-market business is one of the most impactful forms of value-creation a new CEO can pursue, according to a panel of Entrepreneurship-Through-Acquisition (ETA) market experts. To learn the importance of the finance function in ETA investments, Search Party convened a conversation between Anthony Walker, Managing Partner at Next Coast Legacy, Sam Swan, CEO of TaskRay, Eric Lougher, CFO/COO of TaskRay, Emily Young, Transaction Advisory Manager at Boulay and Jake Bitz, Consulting Controller at Boulay. TaskRay is an ETA-backed SaaS company that saw its operations transformed when it brought on board Lougher as CFO. The story of TaskRay's professionalized CFO function is at the core of this authoritative, candid and lively conversation.  Among the key takeaways of this episode of Search Party: • A common feature of founder-led companies in the lower-middle market is a heavy emphasis on cash flow and little emphasis on forward-looking financial metrics. Anthony Walker noted that this dynamic often leaves new owners without the reporting foundation they need to lead effectively. “They've measured the performance of their business by how much cash is in the bank account," says Walker of many lower-middle-market founders. "They're not looking at sophisticated metrics or KPIs.” • To build a finance function that supports both operational decision-making and investor transparency, operators must first assess the starting point and align it with their growth horizon. Emily Young described this as a deliberate diagnostic process that should precede any hiring or systems decisions: “The first step is - know the business. Know where it is today, know where you want it to be tomorrow, a year from now, five years from now.” • For first-time CEOs, the limits of their own financial fluency often surface early. Sam Swan reflected on his own transition, recalling how the budgeting process made it clear that finance couldn’t remain an isolated back-office task: “It was a struggle and that to me was a pretty clear indicator that I need someone who could do this with me.” Ultimately, a professionalized finance function doesn’t just improve decision-making in the present—it lays the groundwork for eventual exit. Jake Bitz underscored that buyers, lenders, and future acquirers all expect reliable financial operations: “Hiring the key people and having that process put in place for how you close the month and how you report is the foundation.” Follow the Search Party video-podcast on LinkedIn: https://www.linkedin.com/company/search-party-channel Search Party Lead Sponsor:Next Coast Legacy https://lnkd.in/eSAuRW5p Search Party Sponsors:Avidbank https://www.avidbank.com/Boulay - Contact Boulay's Search Fund Team: https://lnkd.in/eFF88SVfMayer Brown https://lnkd.in/gU7sPPSgOberle Risk Strategies https://oberle-risk.com/Plexus Capital https://plexuscap.com/ #M&A #search #privateequity #eta #searchfund #insurance

Small insurance brokerages make for "great" Entrepreneurship-Through-Acquisition deals, provided the acquirer has a deep understanding of the industry, says August Felker, an ETA searcher turned CEO of Oberle Risk Solutions. In an interview with Search Party, Felker shares his personal ETA journey to becoming the CEO of a leading lower-middle-market insurance brokerage, starting with being raised by a father who ran a St. Louis, Missouri, insurance brokerage. (Felker's grandfather also was an insurance broker).  Felker discovered the ETA model while working for two Stanford MBAs who had acquired a lower-middle-market logistics business, an experience that convinced him he wanted to follow the same path in his field of expertise. “When I first heard of the search fund, I was like, this is the coolest thing I’ve ever heard.” Felker's ETA search was fortuitous in two ways: He identified the company he ended up acquiring within a matter of weeks, and he was connected to the seller not by an investment banker, but by the editor of an insurance trade journal. “I said what I was trying to do, and this editor was like, ‘I know someone who's selling their business in Madison, Wisconsin. You want me to connect you with him?’” The most stressful part of the deal came late in the acquisition negotiation, when the seller pushed back on final contract terms, such as the earnout and non-compete. “We were so far in and committed," says Felker. "That really threw me for a loop.” Felker explains how the most impactful move he made as CEO was to hire three top-performing producers who dramatically boosted sales: “It’s like recruiting an NBA all-star. They came in and were writing so much new business it just totally changed the game.” Oberle Risk Services provides insurance to ETA-backed companies, among other lower-middle-market clients. "The ETA community is a great community," he says. "How can you not like someone who's risking their financial future and moving across the country? I mean, it's just the coolest thing.” Follow the Search Party video-podcast on LinkedInk: https://www.linkedin.com/company/search-party-channel Search Party Lead Sponsor:Next Coast Legacy https://lnkd.in/eSAuRW5p Search Party Sponsors:Avidbank https://www.avidbank.com/Boulay - Contact Boulay's Search Fund Team: https://lnkd.in/eFF88SVfMayer Brown https://lnkd.in/gU7sPPSgOberle Risk Strategies https://oberle-risk.com/Plexus Capital https://plexuscap.com/ #smallbusiness #finance #lending #privateequity #eta #searchfund

The relationship between lender and lower-middle-market CEO is a critical factor in the success of ETA deals, say veterans of the Entrepreneurship-Through-Acquisition strategy. This episode of Search Party is about how to get the most from your lender over the lifecycle of an ETA investment, with expert commentary from ⁠Castle Capital ⁠Managing Partner and ETA veteran Chandos Mahon, Conor Tidgwell of ⁠Avidbank⁠ and Anthony Walker of ⁠Next Coast Legacy. ⁠ Central to the conversation is the story of the relationship between Avidbank's Tidgwell and Mahon, who as an ETA acquired, ran and ultimately sold a recycling business called Castle Tire. Under Mahon's leadership, the lower-middle-market company did a total of ten add-on acquisitions financed by Avidbank, plus a facility financing. Along the way, Castle Tire's debt structure changed again and again, with close and transparent coordination between borrower and lender.   Among the key takeaways from the engaging and lively conversation: Treat your lender as a strategic partner, not just a source of capital. In an ETA deal, the lender often provides the largest slice of the capital stack, making frequent, transparent communication a key to long-term success. “Your lender is your largest investor. Avidbank was my largest partner in this deal," notes Mahon. "Radical transparency" enables flexibility and prevents surprises. Lenders are more likely to support growth or navigate tough times if they’re looped in early and often. According to Avidbank's Tidgwell, “If we get caught with a surprise and we’re in a reactive mode, that’s typically when lenders are less flexible.” Financing tuck-in acquisitions requires confidence in cash flow and covenant wiggle room. Lenders are open to supporting add-on acquisitions, but only when the platform business has proven stability and enough covenant cushion to absorb uncertainty. “We’re looking for probably a half turn, at least, of cushion on these covenants. We want to make sure it’s an add-on that makes sense for the business, but I think you always start with the numbers, to make sure there’s adequate cushion out of the gate," says Tidgwell Covenants can - and should be - adjusted to support growth. If a company's expansion plan makes strategic sense, lenders are often willing to rework covenants to accommodate short-term trade-offs for long-term gains. Walker described a Next Coast portfolio company meeting in which “the lender kind of raised their hand and said, ‘Hey, why are we talking about constraints here? What does the business need? Isn’t the right decision to relax the covenants in the interest of pursuing that growth?’” Follow Search Party on LinkedIn: ⁠https://www.linkedin.com/company/search-party-channel/⁠ Search Party Lead Sponsor:Next Coast Legacy ⁠https://lnkd.in/eSAuRW5p⁠ Search Party Sponsors:Avidbank ⁠https://www.avidbank.com/⁠Boulay - Contact Boulay's Search Fund Team: ⁠https://lnkd.in/eFF88SVf⁠Mayer Brown ⁠https://lnkd.in/gU7sPPSg⁠Oberle Risk Strategies ⁠https://oberle-risk.com/⁠Plexus Capital ⁠https://plexuscap.com/⁠ Search Party video-podcast website: ⁠https://lnkd.in/efJEa6GV⁠

As a growing number of MBA students become interested in Entrepreneurship-Through-Acquisition (ETA), a proper understanding of the challenges involved in finding and running a business is essential, say Austin Fruchter and Rohit Datta, Co-Presidents of the Columbia Business School ETA Club.  The Columbia ETA Club provides students with exposure to the ETA process, connecting them with investors, operators, and service providers to better understand the search opportunity. “Search is a relatively lonely process,” says Datta, adding that the club also plays a crucial role in building a support network for students before and after they graduate. Over the past year, interest in Columbia’s ETA club has surged, with events doubling and more students engaging in the ecosystem.  In a candid interview with Search Party, Fruchter and Datta describe common traits among ETA-oriented MBA students. Many are drawn to the tangible nature of small business ownership, seeking to step away from high-level corporate roles in favor of hands-on leadership. However, misconceptions persist—particularly about the level of personal commitment and operational complexity involved. “Some students don’t realize how ‘dirty’ it can get,” says Fruchter. The co-presidents also highlight the robust investor ecosystem surrounding Columbia’s ETA program. Investor interest is high, and Columbia students are encouraged to engage with potential backers early. “You don’t want your first interaction with an investor to be, ‘Hey, I need money,’” says Datta.  Fruchter and Datta themselves plan to partner on a search fund after graduation, and they discuss the benefits of partnered search. “It’s incredibly impactful to have someone who pushes you and refines your thinking,” says Fruchter.  Datta, who previously co-founded a SaaS company, agrees, noting that the right partnership can mitigate individual weaknesses. Looking ahead, the Columbia ETA leaders see institutional capital increasingly moving into the space. But they hope the ETA community’s emphasis on people remains its defining trait. “The people in the business drive the value creation,” says Fruchter. “Taking care of employees and empowering your team is a major factor behind the success of search-acquired businesses.” Search Party Lead Sponsor:Next Coast Legacy [https://lnkd.in/eSAuRW5p] Search Party Sponsors:Avidbank [https://www.avidbank.com/]Boulay – Contact Boulay's Search Fund Team: [https://lnkd.in/eFF88SVf]Mayer Brown [https://lnkd.in/gU7sPPSg]Plexus Capital [https://plexuscap.com/] Search Party video-podcast website:[https://lnkd.in/efJEa6GV]

Failing to strengthen the sales function can undermine the growth of a newly acquired business, a CEO stumble made worse in a leveraged environment, three veterans of the lower-middle-market tell Search Party. Founder-led small businesses often lack structured, scalable sales systems—and the ETA searchers-turned CEOs who acquire them must rapidly diagnose and improve how EBITDA is generated, according to a panel of experts convened for a Search Party conversation.  The need for a sales plan is of particular importance to Entrepreneurs-Through-Acquisition (ETA), who search for, acquire, and run lower-middle-market businesses, in most cases as first-time operators.  These CEOs must also navigate the realities of a leveraged environment. Katie Walker, a Principal at Plexus Capital, highlights the added pressure of servicing debt while investing in growth. "Hope is not a strategy," Walker says. "Many of these businesses grew at 10% per year under a founder. But that’s not a plan—that’s just inertia. Counting on that same trajectory post-acquisition is dangerous." Walker urges CEOs to stress-test their growth assumptions and be realistic about sales investments. Many underestimate the time and resources required to build a functional sales operation. "Without a structured, high-performing sales team, growth stalls," Walker warns. "And in a leveraged environment, that’s a real problem." Dustin Sellers, a Managing Partner at ETA private equity firm Next Coast Legacy, explains that many of these businesses have grown on relationships and referrals, not disciplined sales execution. But following an acquisition, growth isn’t optional—it’s necessary to meet the demands of debt service and investor expectations. "Most first-time CEOs have never sold anything," Sellers says. "They come from top business schools where they studied branding, pricing, and marketing—but not sales execution. And now, they must create a revenue flywheel, fast." Mark Mullins, a sales consultant specializing in private equity-backed businesses, warns that new CEOs often fail to grasp their own sales organization’s weaknesses. "They know finance, they know ops—but they assume their sales team must be doing something right," he explains. Mullins says he often meets CEOs who say, "We need more sales," but can’t articulate why they’re selling what they’re selling—or why they’re not selling more. By digging into the details—reviewing sales calls, analyzing customer conversations—Mullins often finds a fundamental lack of accountability and process. "Many legacy salespeople simply aren't A-players—and they never will be," he says. "New CEOs need to decide quickly: Can they improve? Or do they need to be replaced?" Sellers notes that the best CEOs acknowledge their blind spots early and bring in sales expertise fast. "The ones who hire a sales leader quickly are the ones who scale successfully," he says. "The ones who try to figure it out themselves often find they’re a year in—and two quarters behind plan." ETA CEOs are often skilled in operations, finance, and strategy, but without a clear, repeatable sales playbook, they risk stalling their company’s momentum. "You're not being asked to reinvent sales," Sellers says. "You're being asked to execute on the basics. And if you don’t, the business won’t grow." Search Party Lead Sponsor:Next Coast Legacy ⁠https://www.nextcoastlegacy.com/⁠ Search Party Sponsors:Avidbank ⁠https://www.avidbank.com/⁠Boulay - Contact Boulay's Search Fund Team: ⁠https://boulaygroup.com/searchparty/⁠Mayer Brown ⁠https://www.mayerbrown.com/en⁠Oberle Risk Strategies: ⁠https://oberle-risk.com/⁠Plexus Capital ⁠https://plexuscap.com/⁠ Search Party video-podcast website: ⁠https://searchpartypodcast.com/⁠

Shortly after acquiring security-camera service ⁠EyeQ Monitoring⁠ nine years ago, Markus Scott had no way of knowing he’d eventually grow revenue by a factor of 24. He was too busy dealing with “a whole list of terrible things” that indicated the business was doomed. In an interview with Search Party, Scott says, before detailing these tribulations: “This is the place where I should be pouring bourbon.” Scott’s path to profitable growth is an Entrepreneurship-Through-Acquisition (ETA) success story, but it started as a looming failure. The day the acquisition closed, the first-time CEO learned an employee had been accused of sexual harassment. Then the company’s servers contracted a virus. Then the bookkeeper quit. Then the seller tried to start a competing business. Scott says the deep relationships he built with his workers ended up improving team culture, which impacted customer satisfaction. Scott grew up in a middle-class home in Gainesville, Florida. His father was a former San Diego Charger turned educator, with an entrepreneurial side business to supplement the family income. Scott says he, too, eventually wanted to build a lasting business. When he learned about the ETA model, Scott enrolled in business school at Kellogg, and eventually raised north of $300,000 for a two-year search.  After a “devastating” month-fourteen deal collapse, Scott eventually found a very small business in a great industry. His investors, including Next Coast Legacy, encouraged him to structure the deal like a growth equity investment. Scott was a walk-on linebacker and fullback at the University of Florida. While his time on the field was minimal, Scott says the discipline of daily, grueling workouts prepared him for the roughness of entrepreneurial life. Search Party Lead Sponsor:Next Coast Legacy⁠ https://lnkd.in/eSAuRW5p⁠Search Party Sponsors:Avidbank ⁠https://www.avidbank.com/⁠Boulay - Contact Boulay's Search Fund Team:⁠ https://lnkd.in/eFF88SVf⁠Mayer Brown ⁠https://lnkd.in/gU7sPPSg⁠Oberle Risk Strategies ⁠https://oberle-risk.com/⁠Plexus Capital ⁠https://plexuscap.com/⁠ Search Party video-podcast website:⁠ https://lnkd.in/efJEa6GV⁠

An increasing supply of investor capital is chasing business-school students contemplating ETA as a career, and "search-curious" MBA candidates should know the risks involved are manifold, but well worth the journey, according to Matthew Conley and Daniel Lazier, Co-Presidents of the Kellogg School of Management's Entrepreneurship Through Acquisition Club. The Kellogg ETA Club was spun out of the school's private equity club in order to raise awareness of ETA, share best practices and help students self-reflect on whether their skills, personalities and life goals align with this non-traditional career path, say Conley and Lazier. In a frank discussion, the co-presidents discuss the growing popularity of ETA across MBA programs, and the personal qualities that Kellogg ETA club members tend to share, principally a desire to control their own destinies and pursue a more impactful form of business leadership. The search-curious at Kellogg tend to be "motivated by something different than money," notes Lazier. Conley says ETA tends to offer more "internal goods" than "external goods," meaning that while potential money and status may not be as stratespheric as one might find in private equity or investment banking, the intangible benefits of "seeing your fingerprints all over something" are possible in spades in an ETA career. In particular, having an impact on the lives of your employees and their families can be very gratifying, says Conley. The co-presidents describe the pleasantly "round-elbowed" ecosystem of the Kellogg ETA search ecosystem. The ETA club is a locus of activity at Kellogg, with potential investors sometimes visiting the campus several times per week. Lazier estimates that within the three-sided ETA market, demand from investors is highest, followed by interest from MBA students. The supply of available lower-middle-market businesses for sale, notes Lazier, is not increasing, and estimates that some 30% of searchers never find a business to acquire. Conley says that the ETA club aims to make clear the risks not only of not finding a business, but of being unable to successfully lead the business once acquired. That said, Conley notes that even searchers who do not ultimately become CEO of an ETA-backed business often find related positions in search-owned businesses and at investment firms in need of analytical and due diligence talent.   Search Party Lead Sponsor: Next Coast Legacy ⁠https://lnkd.in/eSAuRW5p ⁠ Search Party Sponsors: Avidbank ⁠https://www.avidbank.com/⁠ Boulay - Contact Boulay's Search Fund Team: https://lnkd.in/eFF88SVf⁠ Mayer Brown ⁠https://lnkd.in/gU7sPPSg⁠ Plexus Capital ⁠https://plexuscap.com/⁠ Search Party video-podcast website: ⁠https://lnkd.in/efJEa6GV⁠

Bob Boniface and his ETA search partner went searching for a high quality, blue-collar business in the lower middle market, and found ⁠TransTech⁠, a commercial driver's license (CDL) training business in North Carolina. The business had predictable revenue and competed in an essential, growing market. The seller was impressed with the research that Bob and his parter had done into the niche industry. A letter of intent was issued, followed by a quality of earnings process. That's when the uncomfortable conversations began. Quality of earnings is an early form of due diligence, the importance and utility of which many first time Entrepreneurs-Through-Acquisition (ETA) do not fully appreciate. Sellers, too, can be apprehensive about the process, because in translating cash accounting into accrual accounting, reported revenue and earnings can drop, often followed by a drop in the proposed transaction value, as well. In a fascinating conversation with Search Party, four expert practitioners from the lower middle market discuss the criticality of quality of earnings, dispel misperceptions and compare notes on best practices for keeping investors apprised of shifting numbers, as well as preventing the seller from experiencing disappointment and due diligence fatigue. Boniface is joined in the Search Party episode by Anthony Walker of Next Coast Legacy, and Clay Brownlee and Ryan Turbes, both of ⁠Boulay⁠. Boniface details how quality of earnings revealed lower revenue and earnings than originally estimates. This change didn't kill the deal, but it did require the parties to change the deal structure, as well as require the seller to "cross an emotional rubicon" because the purchase price needed to drop. The experts also discuss expectations around workload and timeline, as well as how a good quality of earnings process can inform and accelerate the post-acquisition plan for value creation. As Boniface puts it, quality of earnings is "something you should really look forward to."   Search Party Lead Sponsor: Next Coast Legacy ⁠https://lnkd.in/eSAuRW5p⁠ Search Party Sponsors: Avidbank ⁠https://www.avidbank.com/⁠ Boulay - Contact Boulay's Search Fund Team: https://lnkd.in/eFF88SVf⁠ Mayer Brown https://lnkd.in/gU7sPPSg⁠ Plexus Capital ⁠https://plexuscap.com/ ⁠ Search Party video-podcast website: ⁠https://lnkd.in/efJEa6GV⁠

Businesses acquired in the lower-middle-market at single-digit multiples of EBITDA can be sold for double-digit multiples, but only if the new owners improve operations and grow earnings, according to three veterans of the Entrepreneurship-Through-Acquisition (ETA) search-fund market. Multiples arbitrage, seller dynamics, buy-and-build opportunities and market mega-trends are attractive features of three industry sub-sectors discussed in this Search Party episode: software, commercial services and business process outsourcing (BPO). While competition for deals remains fierce in the software lower-middle-market, there are "riches in the niches," says Anthony Walker, a Managing Partner at ETA private equity firm Next Coast Legacy. Walker notes that ETA searchers need to find software businesses that are growing strongly but also profitably. What many investors, and lenders, are looking for is "the perfect mix" of "healthy EBITDA with healthy ARR," says Conor Tidgwell, Senior Vice President at Avidbank, which provides financings to ETA and other lower-middle-market transactions. The enormous commercial services sector is benefiting from outsourcing trends among lower-middle-market businesses. But many ETA searchers find these businesses - such as HVAC maintenance, landscaping, restoration - to be uninteresting, opening up opportunities for investors who see value, if not glamor. With the right management, commercial services businesses can be vastly improved improved through the application of sales and marketing resources, as well as the use of technology, says Dustin Sellers, a Managing Partner at Next Coast. Included in the episode is a discussion of the seller dynamics in the three sub-sectors. In the case of BPO and commercial services businesses, the CEOs often are founders who personally provided the services that serve as the companies' core offerings. These founders may not have the skillsets to take their businesses to the next level, and therefore may be open to an outreach from an ETA searcher.   Search Party Lead Sponsor: Next Coast Legacy https://lnkd.in/eSAuRW5p   Search Party Sponsors: Avidbank https://www.avidbank.com/ Boulay - Contact Boulay's Search Fund Team: https://lnkd.in/eFF88SVf Mayer Brown https://lnkd.in/gU7sPPSg Plexus Capital https://plexuscap.com/   Search Party video-podcast website: https://lnkd.in/efJEa6GV  

Women are making gains toward substantial representation in the Entrepreneurship-Through-Acquisition (ETA) community, and supporting each other along the way. In fact, 17% of ETA searchers in the market are now women. In a fascinating conversation, three ETA leaders compare notes about the appeal of the ETA search-fund career, the advantages women can have connecting with fellow entrepreneurs, and the challenges and misperceptions women confront in a male-dominated industry. This episode of Search Party includes Audrey Kohout, CEO of ETA company Luggage Forward, Tatiana Gaspar, Director at ETA private equity firm Next Coast Legacy and Katie Walker, a Principal at lower-middle-market capital provider Plexus Capital. Kohout tells the story of how her and co-searcher/co-CEO Jessica Palfrey looked all over the country for a lower-middle-market business to acquire and run before settling on a logistics company in Boston, owned by two men. A deal was struck due in part to shared values of hard work and humility that transcended gender. The experts also discussed the often-difficult balancing act of growing a business while also maintaining a personal life and, for women and men alike, growing a family. As Kohout puts it: "We're building our lives at the same time that we're building a company." Near the end of the conversation, the three compared stories of awkward moments that women can face when men assume they are not in positions of leadership.   Women's Search Network: https://www.womenssearchnetwork.com/   Search Party Lead Sponsor: Next Coast Legacy https://lnkd.in/eSAuRW5p Search Party Sponsors: Avidbank https://www.avidbank.com/ Boulay - Contact Boulay's Search Fund Team: https://lnkd.in/eFF88SVf Mayer Brown https://lnkd.in/gU7sPPSg Plexus Capital https://plexuscap.com/   Search Party website: https://lnkd.in/efJEa6GV

A career move to the Entrepreneurship-Through-Acquisition (ETA) search-fund market may result in any combination of bewilderment, disappointment, wealth creation and self-actualization, according to A. J. Wasserstein, a Senior Lecturer at the Yale School of Management. Wasserstein, himself the builder of two successful businesses, has made entrepreneurship and the search fund community the subject of his teaching and academic work. As Search Party learned in a fascinating conversation, Wasserstein has developed frameworks not only about the potential of an ETA career to pave a way to self-determination and wealth, but to personal fulfillment, what psychologist Abraham Maslow calls self-actualization. Wasserstein, together with Next Coast Legacy Managing Partners Dustin Sellers and Anthony Walker, discusses the growing awareness of the ETA career path among MBA students, the attributes necessary to embark on a high-risk professional journey. Making sure the entrepreneurial path dovetails with personal values and goals is important, says Wasserstein, because he doesn't want his students to end up "the richest divorced people, or the richest people estranged from their kids." At the center of the self-actualization possible for CEOs of lower-middle-market businesses is the ability to directly and positively impact the lives of employees and other stakeholders, to create an entity bigger than the personal ambitions of the ETA searcher.   Select works from A. J. Wasserstein: Exploring Search Fund Entrepreneur Economics https://yale.app.box.com/s/0mo483h9lmfd04bl1om9dkc7oz4xm2s6 Exploring Search Fund Entrepreneurship Using Maslow's Hierarchy of Needs as a Framework https://yale.app.box.com/s/gz48z3i3t55oxdzqbxk1ny32v6oq775o Including Employees in a Search Fund Waterfall https://yale.app.box.com/s/6ouw7vhe9eq6a24y63dy29mjz166o8ht   Search Party Lead Sponsor: Next Coast Legacy https://www.nextcoastlegacy.com/   Search Party Sponsors: Avidbank https://www.avidbank.com/ Boulay - Contact Boulay's Search Fund Team: https://lnkd.in/eFF88SVf Mayer Brown https://www.mayerbrown.com/en Plexus Capital https://plexuscap.com/

Dustin Sellers and Anthony Walker, Managing Partners at leading Entrepreneurship-Through-Acquisition (ETA) investment firm, Next Coast Legacy, share their personal career journeys through the finance industry to become leading practitioners of the ETA strategy, and comment on the exciting growth of the asset class, the attributes necessary for successful searchers, and the rigors of acquiring and running small- and medium-sized businesses. Dustin, who specializes in mentoring searchers and first-time CEOs, shares the attributes necessary for ETA success, including a willingness to "chew off your own arm" to avoid losing money. He describes the challenge of identifying the right acquisition target as akin to climbing Everest without oxygen, and the challenge of being a first-time CEO as akin to managing while underwater in a scuba suit. Anthony, a due diligence expert who became "disillusioned" making short-term investments at large hedge funds, talks about his light-bulb moment when he learned about the ETA opportunity for hands-on value creation at small- to medium-sized businesses.   About Search Party Search Party is a video-podcast created to elevate knowledge about the Entrepreneurship-Through-Acquisition (ETA) strategy. On a regular basis, the podcast will convene expert conversations about the best practices and opportunities in ETA, a model for business growth, career development and wealth creation that is becoming increasingly popular. Search Party is hosted by David Snow and produced by Elatromme.   Search Party Lead Sponsor Next Coast Legacy https://www.nextcoastlegacy.com/ Search Party Sponsors Avidbank https://www.avidbank.com/ Boulay - Contact Boulay's Search Fund Team: https://lnkd.in/eFF88SVf Mayer Brown https://www.mayerbrown.com/en Plexus Capital https://plexuscap.com/   Search Party podcast homepage: https://searchpartypodcast.com/  

Search Party is a new podcast highlighting Entrepreneurship-Through-Acquisition strategies for value creation with private capital journalist David Snow.