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You’ve been a prominent figure in private equity for over three decades. Could you walk us through your background and how you’ve seen the PE market evolve? What led you to enter the world of SFs?
Indeed, I’ve been active in PE for 32 years, and 6 in Search Fund Investment. I started my career at CVC right after graduating from HEC in 1988. I joined Citicorp Venture Capital when the Spanish team was being built. At that time, PE was a much smaller market, more hands-on world – we were working on midsized MBOs, investing directly from the bank’s balance sheet. Those were genuinely exciting times. It is true we reported to a senior team in London, but we were two young 30-years-old guys doing CVC’s MBOs in Spain! That’s where I learned most of the technical aspects of the business.
In 1992, I joined Corpfin Capital, a midsize MBO firm just founded by Felipe Oriol. I came in as an associate and stayed for 21 years, eventually becoming a senior partner. I worked in the SCR first, and then Funds I, II and III. Looking backwards, we were PE pioneers in Spain.
In 2013, due to strong differences among the partners, I left Corpfin Capital, and joined MBO Partenaires (now MBO+), the French small-cap leader. I opened and led the Spanish operations, doing their same type of deals in Spain. After two successful deals, in 2018, following changes in the Paris team, I chose to step back and half-retire, planning to work in advisory helping Management teams and investing my own money in private transactions.
But in 2019, Javier González Tovar invited me to invest in his Search Fund. I studied the model, invested in the search, supported the acquisition, and joined the board of Plásticos Arias. That experience gave me visibility in the ecosystem in Spain. I started investing in more Search Funds and participated in another acquisition – Norconsulting.
In 2021, as we regularly did, I met with Enrique Quemada, we started sharing our views on the Search Fund market, we saw the potential for a European Fund with our investment philosophy, and together we launched ONEtoONE Asset Management. In 2022, we received regulatory approval by the CNMV for our management firm and fund and started investing. Today, with €35 million under management, we have about 10 participations, one successful exit, and we’re supporting around 50 searchers. I believe scale is essential in this space. What was once a niche for private investors is becoming wider and more professionalized, and it’s important to approach it with the right structure and team.
How would you describe the key differences between investing in traditional PE deals and backing SF acquisitions?
The main difference is control of the deal process. In private equity, you as the investor directly control the deal, you lead it. You manage the vendors, the management team, the bankers, the due diligence. In Search Funds, the searcher is in control. You receive information through him, not directly from the company. That’s a major difference.
It’s important to observe what the searcher prioritizes and how they structure their investment process. For instance, how they analyze the company, how he organizes due diligence – which is often too limited. Alignment is key. The searcher’s objective is, of course, to buy a good business and grow it, but time works against him or her. After months of searching, some may feel pressured to buy a company even if it is not a good one, wrongly believing that not closing a deal equals failure.
That’s incorrect. Even without an acquisition, the experience itself is a valuable “financial MBA.” The consequences of buying a not-so-good company are far worse. That’s why alignment with investors from day one is critical.
OnetoONE Asset Management has supported a significant number of searchers and nearly ten SF investments. What are the main lessons you’ve learned so far? What are your objectives with this first dedicated investment fund?
We’ve learned that misalignment can happen. The market is more competitive than expected, and not homogeneous across geographies. In Spain, while there are good SMEs with succession issues, the market can likely absorb only a limited number of deals each year. Yet, we have 60 searchers competing, creating imbalance. Conversely, the Italian market is very attractive right now: similar type of economy, but only a dozen highly capable searchers are active. France, meanwhile, is tougher – a heavily intermediated market with less direct access to owners and more competition from regional small PE funds and family offices, which inflates valuations.
Ultimately, success always comes down to the searcher. The good searcher finds the right company, manages it properly, adds a lot of value, and surrounds himself with good investors and board members. Our goal as investors is to help him or her, to guide him and try to avoid mistakes, and decide if we invest in the acquisition or not. But it is his talent that results in good deals. We accompany, that’s all.
Our target is 15 to 20 investments. We’ve deployed around 50% of the fund. Our focus is mainly Europe, though we’ve done a few deals in the US and elsewhere – but those are exceptions.
You were recently involved in one of the first quick exits in the SF space. Could you tell us more about that transaction? What made it successful, and what were the key takeaways?
Yes, that was a real success story. The searchers were excellent and found an outstanding business: Crop Salsa.
Why did it work so well? As you know, there are only three ways to make money in a Private investment. First, when the company itself grows in sales and EBITDA. In this case, they were in a great segment – sauces for HORECA – which was undergoing externalization and hence strong growth. Second, strong cash flow allowed for rapid debt repayment, which was also the case here. And third, multiple expansion: buy at a reasonable price and sell well
We exited because the company’s next strategic move required heavy investment in a new factory, which meant years of patient capital ahead. We had the opportunity to realize strong returns in a short period. Generally, we prefer a 5-6 year horizon, but in this case, we achieved our return in less than 3 years
How do you evaluate searchers when deciding to back a fund? What traits or signals do you look for? How would you compare it to evaluating traditional MBI candidates?
The searcher is the key asset. The company matters, but backing the right person is what counts most, because he or she is the one who finds the good company. The team around them – board, advisors – must accelerate their learning and support them throughout.
Prior M&A or PE experience is a clear advantage, especially for sourcing and analyzing deals. But post-acquisition, management skills become critical – which is why we tend to like operator profiles. Unfortunately, very few combine both deal-making experience and the ability to operate a company.
From our perspective, age and experience matter. As the saying goes: “the devil knows more because he is old than because he is evil”. We prefer older, more experienced profiles, and we favor duos.
Compared to an MBI, it’s very different. In MBIs, the manager arrives with the deal and you have little time to assess. In Search Funds, you invest early and build a relationship over time. The alignment is stronger, and your ability to assess the person is much better.
How do you support searchers beyond the initial investment? Do you play an active role post-acquisition? Which sectors or business models do you currently find most attractive?
We try to be very active, even if that limits scalability. It’s simply our philosophy. I believe investors should be in the trenches with their searchers. It’s not just about financial returns. Helping smart, inexperienced people grow into their role is rewarding and creates deep trust.
In terms of sectors, what matters is more the business model of the company than the industry. We like niche sectors where even small companies can hold significant market positions. Defensible positions are critical – whether through technology, know-how, production quality, or market share – to protect margins.
For example, our exited company supplied sauces for HORECA and food processors, a B2B model where the product was critical to the client, yet represented a small share of their total costs. That’s a great business model.
With your extensive experience in PE, how do you view the risk/return profile of SF investments? What lessons from traditional PE can be applied to the SF model? Where do you see room for improvement in how target companies are analyzed?
I don’t believe SF returns will consistently outperform PE. I expect future IRRs to be more in the twenties than in the thirties. Current statistics can be misleading, as they often not focus only on exits (they include also valuations of deals that are not exited yet), and outlier transactions with multiples over 10x distort the picture, especially given the low total number of exits so far. What can differentiate SFs returns to PEs’ is the multiple arbitrage. You have to buy reasonable. Growth and leverage help, but multiple expansion is essential.
In PE, the risk of buying the wrong company is lower because you control the due diligence process more thoroughly. In SFs, the searcher’s limited DD is a vulnerability. Many failed deals result from insufficient analysis.
The key PE lesson for SFs is clear: perform deeper due diligence, and always watch carefully that the searcher is aligned.
What trends are you currently seeing? Do you think we risk seeing too much capital chasing too few deals, as has happened in PE? Do you believe the model can scale meaningfully, or will it remain a niche strategy?
Like PE, this asset class will have cycles. Before 2008, capital flooded into PE. After the crisis, many investors – pension funds, savings banks – disappeared, and deals post-2013 were excellent.
The situation is very different in different markets; In France today, there are too few quality deals, some SF companies are underperforming, there’s a lack of national investors, and it is not easy to close a deal. In Spain, we’ll likely see investors leaving the field in the future. The current excess of capital will force some players out when they realize that not every deal will perform, and some searchers won’t find a great company to acquire.
That said, I don’t believe SFs will remain a niche, but how far it can scale is the question. Bubbles may form and will eventually deflate. Managed with the right size and investor base, it’s a highly profitable segment, but it’s maturing, and discipline is necessary.
Looking ahead, what are your ambitions for OnetoONE Asset Management over the next 5 to 10 years?
My main objective is to deploy Fund I and build a team that can succeed me. We aim to be recognized as a professional, value-adding investor – not necessarily the biggest, but relevant. We want searchers to choose us for the support we provide.
We’re not obsessed with leadership. Good outcomes and respected relationships matter more. We expect to raise Fund II within the next 1-2 years – slightly larger, but maintaining our hands-on approach.
Interestingly, we’re seeing more experienced profiles entering the Search Fund space – beyond the traditional MBA path – and deal sizes are increasing as well. The market is evolving, and we must evolve with it.
