Moonbase Capital, a Search Fund investor based in Barcelona, Spain, released an industry insight White Paper, titled "Why Search Funds are a Major Private Equity Strategy in the Coming Years", in which they outline how Search Funds fit into the investment space and why they are a promising investment vehicle in Europe.
BARCELONA, Spain, Oct. 19, 2022 /PRNewswire-PRWeb/ -- Moonbase Capital, a Search Fund investor based in Barcelona, Spain, released an industry insight White Paper, titled "Why Search Funds are a Major Private Equity Strategy in the Coming Years", in which they outline how Search Funds fit into the investment space and why they are a promising investment vehicle in Europe and beyond.
The White Paper aims to be an in-depth introduction to Search Funds, an investment vehicle pioneered by the Stanford Graduate School of Business, which enables entrepreneurs to find, acquire, and then grow existing, yet stable SMEs into high-performing businesses.
The key insight is that, while SMEs make up 56% of Europe's GDP, they are largely ignored by Private Equity and Venture Capital. Search Funds specifically focus on acquiring and growing SMEs, yielding higher returns than other investment vehicles, at a lower risk. A study quoted in the White Paper by Stanford University's Graduate School of Business shows that in the United States, Search Funds generated an average IRR of 32.6% and a return on invested capital of 5.5x in 2019.
Referencing major studies on the market, the White Paper addresses various topics of interest to both individual and corporate investors considering Search Funds as an option. The topics covered include the following:
- What is a Search Fund and how does it work?
- What are the advantages of this investment vehicle when compared to Private Equity and Venture Capital?
- How metrics and returns work in Search Funds.
- What should investors expect when choosing to put their capital into Search Funds?
Ibrahim Abdel Rahim, Managing Partner of Moonbase Capital, said the following: "SMEs are the backbone of the economy. For example, here in Spain in 2019 SMEs accounted for 71.9% of total employment. SMEs not only generate financial and social value for the local community, creating jobs and servicing local needs, but they are also a vehicle for preserving the local culture. I myself worked alongside my father in a business he started in Egypt in the '80s and grew throughout the '90s and 2000s, producing and selling food ingredients. I was part of the journey, growing the business to other markets in the MENA region and in Europe, some of the best memories of my career. At Moonbase Capital, we strive to support talented entrepreneurial minds with finding and acquiring SMEs so that these fantastic businesses continue to grow beyond their initial founder in cases where there is no heir to the business. Search Funds not only generate attractive and stable profits for investors and entrepreneurs, but they also help strengthen communities and that is what drives us in our work."
To learn more, download the White Paper from our website.
About Moonbase Capital:
Moonbase Capital invests in SMEs through Search Funds, an innovative new asset class that is more diversified than Private Equity but lower risk than Venture Capital, yielding stable and frequent returns to investors. Our main focus is on providing entrepreneurs with the most hands-on support throughout the search, acquisition, and growth phases of their journey. Our searchers are operating across Spain, France, Italy, the UK, and Japan.
Media Contact
Teodora Panțu, Moonbase Capital, 34 666 68 53 82, [email protected]
SOURCE Moonbase Capital
Share this article