By Newton M. Campos
Professor of Entrepreneurship, IE University | Partner, Newton Equity Partners
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Introduction: Aging as a Macroeconomic Catalyst
Latin America is aging at a pace unprecedented in human history. By 2050, there will be more than 27 million older people (65+) who will require dedicated care, triggering seismic shifts across public health, labor, and industrial dynamics. While much has been written about the tension this places on pension systems and informal caregiving structures, the implications for small and medium-sized enterprise (SME) ownership and, by extension, Search Funds, are equally profound.
In collaboration with IE University and the Inter-American Development Bank, I co-authored the study Plan for the Creation of an Entrepreneurial Ecosystem for Long-Term Care in Latin America and the Caribbean (Jan 2025). The report addresses how public-private partnerships can strengthen care systems, but it also indirectly exposes a major investment thesis: aging is not just a social challenge, it is a driver of ownership transition and entrepreneurial growth.
Aging and Succession: The Dual Opportunity
Aging, when viewed through an entrepreneurial lens, reveals two distinct but interconnected opportunities:
- Succession in aging-owned businesses across all sectors, and
- Acquisition potential in the “Silver Economy.”
Search Funds, with their patient capital and operational focus, are well-positioned to capitalize on both.
Opportunity #1: Aging Founders Across all Sectors.
Across Latin America and indeed across many emerging economies there are tens of thousands of SMEs operated by founders nearing or past retirement age. These companies, often profitable and locally rooted, face a “succession cliff” due to:
- Lack of heirs or management successors;
- Absence of formal transition planning;
- Limited access to traditional buyers or strategic investors.
For Search Funds, this presents a classic opportunity to acquire a stable business at a fair valuation, preserve its core, and implement operational improvements.
The demographic dimension reinforces this trend. As life expectancy increases, so does the number of founders who delay exit — often resulting in gradual business stagnation or sudden closure upon a health shock or retirement decision. In this context, Search Funds act as continuity vehicles, offering liquidity to founders and continued growth to their companies.
Opportunity #2: The Silver Economy and Care Sector
Our recent research with the IDB focused specifically on the long-term care market, which is expected to expand dramatically due to aging populations around the world. Key private-sector subsegments that could match strict Search Fund criteria include:
- Home-Based Care Agencies. Classic Search Fund profile: Often founder-led, cash-flow positive, regionally known, and operationally complex. Recurring revenue, staffing scale-up potential, and immediate impact through professionalization.
- Caregiver Matchmaking Platforms. Tech-enabled services with operational depth: Network effects, defensibility through trust/screening layers. Still fragmented and often bootstrapped — ideal for consolidation and regional expansion.
- Caregiver Training and Certification Schools. B2B or B2C educational services with regulatory alignment: Can be standardized, accredited, and scaled geographically. High-margin potential, repeat students, and alignment with workforce formalization trends.
- Online Caregiver Academies. High scalability and margin, but less operational depth: Still early-stage in Emerging Economies. Good as add-ons or bolt-ons to physical training assets. Strong fit for digitally-minded operators.
- Day Centers and Activity Clubs for Seniors. Real estate-light care delivery with strong local demand: Moderate operational complexity, repeat customers, and family-driven purchasing decisions. Works well in urban centers with aging middle class.
These businesses tend to be highly fragmented, undercapitalized, and often founded by family business entrepreneurs or former caregivers — a profile that mirrors early Search Fund targets in other verticals. With appropriate capital and professionalization, they can scale regionally and contribute to more formalized and efficient care ecosystems.
Moreover, as governments recognize the limits of public reach, outsourced service delivery is becoming an increasingly viable model, providing revenue stability to well-managed operators. In other words, there is latent potential for Search-Funded care companies to become strategic partners to larger healthcare providers.
From Challenge to Growth
Rather than viewing aging solely as a burden or a challenge, we should treat it as a macroeconomic transition, one that requires thoughtful ownership solutions and entrepreneurial leadership. Search Funds offer both.
They can:
- Provide dignified exits to founders across all sectors;
- Scale businesses that support the elderly;
- Generate long-term value for investors;
- Contribute to regional development and job creation.
As Latin America and other emerging economies navigate the coming decades, the intersection of aging, succession, and entrepreneurship may well define a new frontier for the Search Fund model.
Read the Full Study
Plan for the Creation of an Entrepreneurial Ecosystem for Long-Term Care in Latin America and the Caribbean
Authors: Celia de Anca, Newton M. Campos, Concepción Galdón, Eugenia Gutiérrez
Published by the Inter-American Development Bank and IE University, 2025.
