Building a proprietary search funnel as a self-funded searcher

If you've decided to search for a business to acquire and operate, and you're doing it without outside funding, you have some unique challenges and opportunities.

The challenge is that you lack both the budget and the time to search for opportunities the way a traditional searcher or PE firm might.

And yet, the opportunity is to take a systematic approach that makes up for this by creating a structure and a process. You can find a business at a fraction of the cost with a smaller search team, giving you a strong shot at a higher return.

How do you get started?

Here's what you do:

1. Define your niche. What are you looking for? You might care deeply about environmental services, or maybe you want to bring your software skills to a company that needs them. Your experience, connections and insights can give you an edge in under-served markets and make it worth your while to focus.

2. Digital plus in-person. The tech stack here is simple. A CRM is critical to keep track of conversations and people. Streak CRM sits on top of Gmail and is free. Google Alerts is a free way to stay on top of the stories being written in your industry. And LinkedIn is the best way to contact almost anyone professionally. You should also consider bringing in interns to help you search this way. And don't over-estimate the power of simply showing up in person at industry events and showing attendees how motivated and serious you are.

3. Network relentlessly. Smart lawyers and lenders and accountants will take the time to talk to you. And the entire range of people who care about what happens in your industry can be reached out to, one-on-one. There are also plenty of online forums where you can become known and respected.

4. Reach out with care. The fact that it's not an auction can be appealing to some sellers. When you come across a company that you believe is a fit, send a short note to the founder, offering them a direct opportunity to chat with you. Make it clear that you're respectful, serious and motivated. The sale of their business is not an insurance plan or an end, it's a transition to a new way for them to have an impact on the world in a different way. It's okay to describe a bit about your search criteria, but don't get bogged down in the details.

5. Content. Zero searchers do content marketing today and almost all of them will in 10 years. This can be a way to built a brand and attract sellers who wouldn't have considered selling otherwise. A podcast about your industry, a blog with stories of how businesses have been transformed or simply a regular column where you share your insights about the industry can all combine to establish you as the category leader in what you do. This is time well spent because it is a leveraged asset that keeps paying dividends.

6. Relationships. Make it easy for your friends and mentors and post-MBA peers to refer leads to you. If it's clear to them the sorts of businesses you're seeking, and the kind of seller you have in mind, they can save you a lot of time and energy by giving you biographical information about the founder of the business and an easy way for you to get in touch.

7. Optimize. "Sales cures everything." It's worth learning to sell, and to figure out how to create a predictable funnel. Track your funnel at every stage, and relentlessly find ways to lower your burn rate, while finding better founders.

8. Relentless and patient. If you stop, you've failed. It's okay to take a vacation, or shift gears for a month, but persistence is perhaps the single most useful tool an early searcher can bring to a proprietary search process when you aren't armed with oodles of cash. Keep at it, every single day.

If you like this content, you can read more on the Feta Fund website.