A search fund is a model in which a “searcher” raises capital from investors to find a suitable business, acquire it, and then lead it as CEO. In the Netherlands, the model is still relatively new: there are growing networks and conferences, but few success stories so far. Duco Salomons (Hotek Hospitality Group) and Jard van Heerde (Socho IT) are two of the first Dutch searchers to successfully complete their search.
More and more young entrepreneurs are choosing not to start their own start-up, but to take over an existing business. Through the so-called search fund model, they attract investors to find, buy and manage one company themselves. "But there are still few success stories in the Netherlands.
“We’ll be done here around five, so I’d like to spend a little more time with the team at the end of the day,” says Duco Salomons toward the end of his interview with Brookz. Since earning the unofficial title of “first successful search fund seeker” in the Netherlands over a year ago, his life has looked quite different from what it was in the fourteen months prior. For more than a year, he was essentially working on his own to find a business to acquire, following the search fund model.
In short, a searcher raises capital to find a suitable company, acquire it, and then lead it as chief executive officer (CEO). Traditionally, search capital is raised in advance from investors to cover salaries and due diligence costs. This reduces personal risk, as no personal funds are required. Another approach is “self-funded,” in which the search is financed with the searcher’s own funds. This entails a higher personal risk if a deal is not reached, but can result in a larger equity stake for the entrepreneur.
Sold out conference
In recent years, search funds have steadily gained recognition in our country, but there is not yet a fully developed ecosystem of search funds, financiers, and investors, according to Ronald Kleverlaan. He is chairman of the SME Financing Foundation and director of the European Center for Alternative Finance. He observes that entrepreneurs considering selling their businesses are primarily focused on day-to-day operations and are not actively seeking out this specific financing model. Knowledge is often shared through other entrepreneurs. “But there are still very few success stories in the Netherlands.”
Still, there’s a clear upward trend, according to Jard van Heerde. He became familiar with search funds while pursuing his MBA at INSEAD in Fontainebleau and Singapore and decided to organize a conference on the topic, hoping to attract about a hundred participants. “Within two weeks, the event was sold out, and in the end, 175 people attended from all over the world—from Europe and the United States to Australia.” A year later, the conference was held again and drew 350 people. “Events are an important meeting place for searchers and investors.”
The United States is invariably cited as the model for the success of this relatively new M&A approach. There, the market has matured and grown in popularity over the past decade. As a result, it is now showing signs of saturation, and the chances of success in finding suitable candidates are diminishing, says Kleverlaan. What is often less well known is that the search fund model has been surprisingly successful in southern Europe, particularly in Spain and Italy. Van Heerde points out that Spain’s IESE was the first MBA school in Europe to embrace the model, thanks to an enthusiastic professor. And that a Spaniard who studied in the United States founded one of the first European search funds. “That’s how the ball started rolling.” In that light, it’s interesting that Rotterdam School of Management has been offering the course “Search Funds” since last academic year, Salomons adds.
In terms of investors, these are often individuals—such as successful former CEOs—who believe in the model and can offer operational expertise and a local presence. They connect with searchers through online platforms, conferences, and search networks. After joining, investors are kept informed of the search’s progress and provide feedback on potential acquisitions. Although the searcher is in charge, investors generally need to be convinced before committing capital to the final acquisition. According to Salomons, however, there is a nuance to consider. “Although you keep investors informed and they stay on top of developments, most decisions regarding the design and execution of your strategy ultimately rest with the searcher.”
Solo process
Salomons followed the traditional model, which he was introduced to during his MBA at IESE Business School in Barcelona and his subsequent studies at the Haas School of Business in Berkeley (U.S.). “I come from an entrepreneurial family and saw this as the perfect opportunity.” Given his background, he focused on businesses with a technological component. “Because of favorable market dynamics, growth potential, and financing options,” he summarizes. It’s a massive market in which he actively sought out opportunities in a structured way—using lists of potential businesses and through trade shows, phone calls, and emails. “It’s quite a solo process. It’s up to you to shape the search phase. You have to set up your own IT infrastructure, hire interns, and devise a plan of action.” It took a lot of optimism and discipline to persevere, he continues. “You have to muster the commitment every day to take those steps, even when it seems like you’re not making any progress.”
At the same time, the search process can actually be quite adventurous. That’s how Salomons discovered various “hidden” industries. “The moment you start searching, you come across industries you simply didn’t know existed. For example, I found the sensor market quite interesting, because sensors have to be calibrated every year.”
Van Heerde opted for a slightly different approach than Salomons and went for a “self-funded search,” which, in his own words, gave him more flexibility and a more authentic entrepreneurial experience. “With a traditional search fund, investors take a larger stake in the business, and you typically end up with larger businesses,” he explains. He set his sights on stable B2B businesses with an EBITDA between 0.5 and 1.5 million euros. “That’s a market segment that’s under the radar of many private equity firms.” In addition, he wanted a business with predictable revenue and loyal customers to avoid the unpredictability and dependence on the former owner that often characterizes project-driven businesses. Plus, there had to be potential for improving business processes and the organization, with sufficient market capacity.
Van Heerde recognizes Salomons’ personal experience. “The search process is a lonely endeavor, involving a lot of cold calling and the need to ‘educate’ advisers about the search fund model.” It can be mentally taxing. Many searchers give up because the process is long and uncertain, with no immediate reward. The final phase of a deal can also be very stressful, with high stakes and potential tensions.”
Successful 'acquisition'
Ultimately, Salomons found his new business, Hotek Hospitality Group (a specialist in innovative access solutions, including for hotels), by approaching the founder directly at a trade show. “This allowed me to better convey my personal commitment and value than I could have by going through advisers.” One of the reasons he was a good fit for the business was its strong international market position in keyless access systems, its solid track record with prestigious clients, and room for further innovation. They already had 26 years of experience and had established high barriers to entry in their market. In addition, Hotek offers a unique Mobile Key solution, which allows you to open a (hotel) door with a simple swipe on your phone. Furthermore, the business supplies a wide range of supplies and accessories for hotels, which, according to Salomons, is highly valued by hotel owners, who prefer to deal with a single point of contact. “But I also feel a personal connection to the welcoming hospitality industry.” According to him, the previous owners wanted to step back to pass on the legacy they had built to someone with fresh energy and a long-term vision. “We implemented a six-month transition period so that I could get to know the people, the company culture, and the processes.”
The search process is a lonely undertaking, with a lot of cold calling and the need to "educate" advisers about the search fund model
Van Heerde , in turn, took a detailed look at about a hundred businesses before settling on Socho IT. The search for this business—which provides subscription management software and ERP to media businesses and publishers, and counts NRC, Voetbal International, and De Groene Amsterdammer among its clients—was a short one. Van Heerde began in August 2024 and closed the deal as early as March 2025, whereas such a search typically takes one to one and a half years on average. “We hit it off right away and had a collaborative approach. I see it more as a partnership than a ‘hard-nosed’ acquisition,” said Van Heerde. He says his motivation is not primarily financial, but lies in personal development, the challenge, and the desire to contribute to the automation and digitization of the media industry.
Search funds versus MBI
The definition of search funds and their practical approach raise the question of how they differ from a management buy-in (MBI). According to Kleverlaan, the main difference is that with a search fund, the “searcher” (and the investors) do not yet have a specific business in mind, but rather a sector in which they want to operate, and they then look for a suitable business. “In an MBI, the business is often already known to the manager.” Salomons adds that search funds make it possible to acquire larger businesses thanks to well-capitalized search fund investment funds. “It’s also a full-time search, whereas a management buy-in often takes place alongside an existing job.” And, he adds, another difference is the presence of investors around the searcher who provide guidance and reinforce credibility with potential sellers.
When asked about potential growth opportunities associated with the use of search funds, Kleverlaan points out that searchers are still predominantly male MBA graduates, such as Salomons and Van Heerde. According to him, the model offers opportunities for people with different profiles, such as mid-level managers who want to pursue an entrepreneurial path. “The risk for the searcher is lower than with a startup, because an existing business is acquired and there is often a base compensation during the search phase.”
On the other hand, investors commit capital to a single specific business, which entails a higher risk than investing in a diversified fund. Kleverlaan: “That’s why thorough due diligence on the searcher is crucial. Investors must have confidence in the searcher and provide added value, such as a network and market knowledge.’ As developments in the U.S. show, as the ecosystem matures, investors will invest in multiple search funds to spread risk. This, too, can help the market as a whole to grow.
After about a year at the helm of Hotek, Salomons is certainly feeling more at ease and less like a “newcomer.” “I’ve found that my MBA knowledge and previous experience are useful for gaining a helicopter view of various business units. And the importance of ‘people, people, and people’ as the biggest success factor has certainly been confirmed. We’re focusing heavily on culture, motivation, and hiring talent—such as a financial controller and a business developer—to further professionalize the company. The work requires a lot of energy and dedication—even on weekends—but it’s very rewarding.” Van Heerde agrees: “Running the business is much more fun and energizing than the search itself.”
Frequently Asked Questions
What is a search fund?
A model in which a “searcher” raises capital from investors to find a suitable business, acquire it, and then lead it as CEO.
What is the difference between a traditional search fund and a self-funded search fund?
In a traditional search fund, the capital is raised from investors in advance, which reduces personal risk. In a self-funded search, the searcher finances the search themselves, which involves higher personal risk but potentially a larger equity stake.
What is the difference between a search fund and a management buy-in (MBI)?
With a search fund, the searcher does not yet have a specific business in mind—only a sector—and the search is a full-time endeavor. With an MBI, the target business is often already known, and the search is typically conducted alongside an existing job.
How long does the average search fund search take?
On average, one to one and a half years, although this can be shorter—as in the case of Jard van Heerde , who completed his search in about seven months.
Has the search fund model already proven successful in the Netherlands?
The model is steadily gaining recognition, but a complete ecosystem of search funds, financiers, and investors is still lacking, and there are still relatively few Dutch success stories.
