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The 2026 Search Fund Study by the Stanford Graduate School of Business examines the development, performance, and trends of SFs. The study tracks 862 core SFs launched between 1984 and 2025 in the United States and Canada, making it one of the most comprehensive analyses of this entrepreneurial model.
The SF ecosystem has expanded significantly in recent years. The number of newly launched SFs reached historically high levels in 2023, and activity remained strong through 2024 and 2025. However, newer entrepreneurs have faced more difficult conditions when trying to acquire companies. Acquisition rates have decreased compared with earlier periods, mainly because of increased competition, changing market conditions, and a wider range of preparation levels among entrepreneurs. Overall, 58% of completed SFs successfully acquired a company, while the 2021–2024 group achieved a lower acquisition rate of approximately 48%.
The typical entrepreneur profile has remained consistent. Recent searchers had a median age of 32 years, and around 80% held an MBA. Many came from professional backgrounds such as management consulting, private equity, investment banking, and finance. There has also been growing interest in formal education related to ETA, with more business schools offering courses that prepare students for the search fund process.
The fundraising process has remained relatively stable. Recent searchers usually spent around three months raising capital, collecting a median of approximately $550k per entrepreneur from about 13 investors. More searchers are also choosing to work with partners, which has historically been associated with higher acquisition success rates.
The companies acquired through SFs are generally established SMEs. Recent acquisitions typically involved companies with around 30–40 employees, purchase prices near $16 million, and valuation multiples of about 6–7 times EBITDA. Service companies were the most common acquisition targets, while software, healthcare, education, and technology-enabled businesses also remained popular.
Financial returns for SF investors have remained attractive. By the end of 2025, the overall SF industry produced an aggregate IRR of 33.9% and a ROI of 4.75x. SFs that successfully exited their companies performed even better, reaching approximately 39.3% IRR and 5.98x ROI. These results show that SFs have historically generated returns above many traditional investment alternatives.
The study also highlights that returns are not evenly distributed. A small number of exceptional SFs produced very large gains and significantly influenced average industry results. Strong performance was more common among companies with recurring revenue, predictable cash flows, effective use of debt, and businesses in certain sectors such as services. SFs led by partners also tended to achieve better outcomes than solo searches.
A major new topic in this year’s study is the growth of Long Duration Enterprises (LDEs). This model differs from traditional SFs because entrepreneurs raise larger amounts of committed capital upfront and aim to hold businesses for much longer periods, often more than ten years. LDEs usually focus on acquiring multiple companies, building a larger organization, and creating long-term value rather than pursuing a shorter exit timeline.
The SF model is also becoming increasingly international. Outside the United States and Canada, hundreds of SFs have been created, with particularly strong growth in Europe and the Asia-Pacific region. In 2024–2025, new SFs appeared in several countries, showing that ETA is becoming a global phenomenon.
In conclusion, the study shows that SFs continue to provide a powerful path for entrepreneurs to become business owners and CEOs. Although the market has become more competitive, successful searchers can generate significant value for investors and themselves. The strongest results are usually achieved by entrepreneurs with experience, strong preparation, effective partnerships, and the ability to identify high-quality businesses with growth potential.
Read the full study here:
