The Next Step

Lui Pangiarella – founder of WayFinder Capital and Second Squared. Both of these companies are active contributors and participants in the search fund ecosystem here in Australia. 

Lui co-founded Second Squared a couple of years ago to help build the community of searchers here in Australia. They've just recently founded WayFinder, Australia's first institutional fund focusing on the search fund model.

In this episode of The Next Step Podcast Pete and Lui have covered a whole range of things and discuss a lot of exciting themes that relevant to investors and searchers alike. Lui has a depth and breadth of understanding of search and search fund asset class and as an opportunity for searchers and operators. We delve into a bit more the concept of the fund that he's raising and how that will contribute to the growth of the model here in Australia. 

Show Notes: 

·         01:32 –Lui talks about what brought him to search and his journey on search. 

·         03:08–Pete and Lui talk about what are the attributes of a market that is appropriate to search and what are the fundamentals of the Australian market that lean towards the model of search.

·         07:00 – Pete and Lui talk about how he founded Second Squared and made it a vehicle to run searches in Australia, and talk about the characteristics of searchers in Australia. 

·         11:40-Pete and Lui talk about searchers' development and pattern recognition and what are the attributes that makes them a good searcher. 

·         16:13-Pete and Lui talk about the Wayfinder and what it means for the market and how it helps the search community.
·         21:55-Pete and Lui talk about the view and reputation of the Australian search to the international community of search fund.   

Learn more about Search Fund and entrepreneurship through acquisition and connect with Pete and Lui: 

Connect with Pete: LinkedIn
Connect with Lui: LinkedIn

Show notes

·     01:40 –Heather talks about her how she came across and embraced the search model and its community 

·     04:19 –Heather talks about how the SBA (Small Business Administration) helps the search community in the U.S.

·     07:42 – Pete and Heather talk about the capabilities and coachability of the searcher have an impact on his/her success

·     12:05- Pete and Heather talk about the structure for bigger banks to lend to smaller businesses and its ability to invest on the search model

·     17:10-Pete and Heather talk about the process of communication after having debt on a bank, what is in the U.S. market and how it is different from the Australian market and the future of Banks involvement search fund businesses? 

Learn more about Search Fund and entrepreneurship through acquisition and connect with Pete and Heather:

Pete Seligman: LinkedIn

 Heather Endresen: LinkedIn

On this episode of "The Next Step", I speak to Michael Chew, who's the Managing Director of Flywheel Effect, which is a self-funded search vehicle based in Melbourne, and looking for deals across Australia.

I've known Michael for about six months, since he first thought about starting a search. It's been great to get to know him and his approach to this challenge of search, because I think it's a really thoughtful approach. I've seen him evolve his thinking around the model as he's gone through his search, both in terms of what it means for him, and the businesses that he's seeking out, but also as it means for the search model more broadly.

Given that he is a self-funded searcher, I've used this opportunity to really dig into that model, as opposed to the traditional model. In the episode, we look at the pros and cons of each and tried to understand what might make a searcher select one model or the other, but also what the pros and cons might be for an investor of those two models. We cover a range of ground.

Over the past few months, I've spent a bit of time talking to him about his search along the way, and this was a great opportunity for us to explore some more kind of conceptual aspects of the search fund model, self-funded search, what it means for you, and in particular, your family and the impact of that. We also look at the way in which his thinking around search and his approach has evolved over the last few months. I hope you enjoy the episode.

Connect with Pete: LinkedIn
Connect with Michael: LinkedIn

In this episode of The Next Step, I speak with Greg Green, director of Single Trail Capital. We focus a lot of the conversation around the search phase and shed some light on what it's actually like to be in the trenches of conducting a search, what things need to be considered, and what might not turn out the way you want? 

Throughout this episode, Greg shares some great insights into what he has learned through his journey in search and where it has taken him.

Show notes: 

·     01:14 –Greg talks about his journey and what brought him to search and how he started his search phase, and what he did to improve along the way. 

·     08:15 – Pete asked Greg to talk about the challenges in the search phase and differentiating the opportunities by quickly filtering through them and rejecting more than saying yes to it.

·     10:20-Pete and Greg talk about the proper mindset in growing your business on the search model and how to engage and get your message across to a vendor or a business owner.

·     18:07-Pete asks about the things Greg expects to experience during the search phase that turns out to be completely wrong and what are the things he learns during the search phase that he did not anticipate. 

Learn more about Search Fund and entrepreneurship through acquisition and connect with Pete and Greg:
  Pete Seligman: LinkedIn
 Greg Green: LinkedIn

Enrique Chamorro is passionate about the search fund model. Before learning about search fund, Enrique was a full-time private equity lawyer. He heard about search through his friend and client and fell in love with the concept, thinking it was the best example of a win-win partnership and became an investor right away. 

In this episode of The Next Step Podcast, I talk with Enrique about the Spanish market as one of the countries that stands out globally as a hotbed on search fund. We also discuss what the Australian market should do to emulate the growth of search fund in Spain. Also, in this podcast, Enrique talks about the things that a searcher should think about when recruiting their team members and what are the things you should look for and how you should pick the best advisers and some of the things you should consider in being a searcher.

Show notes:

· 01:43 –Enrique talks about how he fell in love with the search Fund concept how he becomes a search investor to working as a private equity lawyer and becoming one of the few search fund lawyers in Europe. 

·     06:57 –Pete and Enrique talk about an investor as being a searcher themselves before and helping the new generation of searchers today. They also talk about what are the differences in the search fund market in America and Europe.

·     09:34 – Pete asked Enrique’s insights on what it is about Spain that has made it a market where search has seen to be relatively successful and what impact COVID has made to Spain’s search fund market.

·     11:15-Enrique talks about the origin of searchers in Spain and how the support network or the advisers could have an impact on the success of the searcher.

·     21:35-Enrique and Pete’s thoughts about what makes a good searcher.

 
Learn more about Search Fund and entrepreneurship through acquisition and connect with Pete and Enrique:
 Pete Seligman: LinkedIn
Enrique Chamorro: LinkedIn  

Shownotes: 

·         01:28 –Andrew talks about his background and career in international development and how he comes to meet the search fund model and build a partnership in South Africa.

·         4:50 –Pete and Andrew talk about how search fund focuses on the people and the talent, also talks about the other process such as reverse search and building capabilities.

·         9:26 –Pete and Andrew talk about how search investors choose which to invest in and how they see the market.

·         13:00 –Pete ask Andrew the U.S. market as the most developed market for search fund, how search investors approach that market, and how searchers compete for investors.

·         17:47-How Pete and Andrew describe the attributes of a good investor and the different processes of investing.

Learn more about Search Fund and entrepreneurship through acquisition and connect with Pete and Andrew:

Pete Seligman: LinkedIn
Andrew Locke: LinkedIn

Nick Bamford is the Managing Director of SRO Technology. SRO is actually one of my own companies (that I purchased as a self-funded searcher many years ago) so it's really exciting to be able to interview Nick and let him share some of the backstory on how he began as a searcher himself, what led him to join SRO Technology, and his learnings from the process.

In this podcast, Nick and I talk about the frontline of search funds and what it's like to go through the process, and what are the things that really stands-out from a searcher's perspective, as well as what are the characteristics for a good searcher? 

It's a great interview with a lot of valuable takeaways.  

Show notes:

·     2:02 – Nick talks about his journey on Search Fund. How he came across the search fund concept and how he helped his father grow their family business.

·     08:47 – Pete askes Nick about his transition period in consultancy and what are his views on bigger businesses. Also, they talk about what makes a good searcher and what it takes to be a searcher from his experience.

·     13:00 – Pete and Nick talk about self-awareness as a search operator, how to build a team around you, and how you should learn necessary skills along the road and fill the gaps.

·     14:28- Pete and Nick talk about the thought process and expectations upon hearing about the concept of search funds, and doing the search fund itself.

·     21:00- Pete and Nick talk about what sort of question should you ask yourself in managing a search fund, what are the motivations and how to determine if it is the right path to take.

Learn more about Search Fund and entrepreneurship through acquisition and connect with Pete and Nick:

Pete Seligman: Linkedin
Nick Bamford: Linkedin

Jake Nicholson is considered one of the leading figures in regards to Search Funds in the current generation. He’s been in the field for more than a decade and has a reputation globally for being one of the real experts in the search fund, entrepreneurship through acquisition and all things related to that community.

Together with Insead professor Mr. Timothy Bovard, they built and run the world’s first accelerator for search funds SFA (Search Fund Accelerator), and ran that for a couple of years and now running a different platform for search fund entrepreneurs in Australia.

Given his experience, he is well recognised as having a deep understanding in the market for search fund, globally. At the moment his focus is on the Australian market, which is very useful to the region.

In this podcast, Pete speaks to Jake about the fundamentals of search funds, entrepreneurship through acquisition, how Search Funds is different from start-ups and focusing on how to build the marketplace for Search Funds in Australia.

• 01:20 –Jake talks about his journey on Search Fund and how search funds is different from startup.
• 06:49 –Pete and Jake talks about what the search fund model actually looks like from the investors perspective and the searchers perspective and how the Search fund model mechanics works?
• 18:27 –Pete asks what is Jake’s impression of the Australian market compared to the US, UK and Spain and How Generation and Culture have an impact to the Search Funds in the region. 
• 25:46-Jake talks about how business owner, searchers and search investors help each other to work to grow the search fund community.

Learn more about Search Funds and entrepreneurship through acquisition and connect with Pete and Jake:

Pete Seligman: LinkedIn
Jake Nicholson: LinkedIn 

Hi everyone and welcome back to The Next Step Podcast. In this season, season two, I'm going to be focusing on search. About 10 years ago now I left corporate life to acquire my first business in partnership with my good friend Iain Morris.  

Over the last 10 years I've acquired four more. I've done three tours of duty as a CEO of those businesses. We've exited two of them and sold down partial stakes in the other three. I'm currently sitting as a non-exec director on two broad platforms and remain a material shareholder in those businesses. 

It's strange to think that it's only really been in the last six to 12 months that I've learnt about this concept in this model of search and entrepreneurship through acquisition. Even though it's actually what I started doing about 10 years ago today. 

The exciting thing about search is that it's owner operator and entrepreneur led, it's people first and business second, and that's what attracts me to it the most. It's also focused on the smaller end of the market, businesses that are turning over or have earnings of somewhere between half a million and 3, 4, 5 million is usually what you'll find.  Employee bases of 15 to 100 people. 

These are the businesses that have probably been around for quite a while. They've got great cash flows, they've got really good foundational customer basis, they've got good employees, great teams. And they've got really passionate founder owners, who are potentially getting to a point where they are ready to exit but they don't have a succession plan, and they need that next generation coming through. 

Search is one of the models that can provide exactly the structure that they are after. It's also a really exciting model for the operator or the searcher, the individual that wants to get into a position of ownership and operation of their own business. It's where I was 10 years ago coming out of corporate and just wanting more autonomy and more accountability, wanting to have something of my own that I can lead and drive. 

I also want to know that I can make a real difference if I put my energy and passion and sweat and tears into this business, it can make a difference to its growth and its future. So, I think there's a model here that I'm confident has legs given the amount of traction that it's got globally. And I think it's a model that can really suit the Australian market. Now in the Australian market, you know, there's probably only been two or three traditional search funds raised and those have only been raised in the last couple of years. 

There is probably been another handful of what you'd describe as self-funded searches over the last decade, but it's still very, very new and I think we've got an opportunity right now if we focus on removing the friction in that market to enable searches to come to market more freely and educate the people in that ecosystem whether that's lawyers, accountants, bankers and even business owners around what this model means, we can really create some amazing opportunities. 

And fundamentally if you think about the bigger picture, start to facilitate that transition of ownership, that intergenerational transition of ownership, from the baby boomer generation across to the next generation of business owners. So it's a really exciting thing for me, I'm very passionate about it.

I'm actively investing in searches at the moment and supporting those searchers through their initial phases. And I'm really excited to try and identify all of those people I can speak to and bring into these episodes of this podcast, to help everyone understand what is search? What are the pros and cons? What does it mean to be a searcher? What does it mean to be an investor? And how people can get involved? 

So I hope you enjoy this season of The Next Step!

In this final episode of the season, I chat with Paul Taylor, principal consultant at Catalyst6 Consulting, leadership expert, and someone who I've known for some time. Paul has played a positive part in my own development as a leader and communicator, and in today's podcast, he shares some fascinating insights into what makes a leader influential and how we can all become better leaders in our individual roles and lives.