The latest Stanford Primer documents a decade of growth and professionalisation. The headline number is that the model has more than doubled in size without giving up its returns.
The recently published Stanford Search Fund Primer 2026 documents the significant evolution and professionalisation of the search fund model over the past decade. Read against the 2018 edition, four figures stand out.
What changed between 2018 and 2026
- 681 search funds globally, against 325 in 2018 — a 109% increase that reflects the model's growing validation as a route into SME ownership.
- 35.1% historical IRR at 4.5x MOIC. Compared with the prior edition this is multiple compression alongside a higher IRR, consistent with earlier exits and liquidity events.
- A 20-month average search period, down from 23 months, reflecting greater efficiency in the search phase.
- $5–10m typical acquisition size, with acquisition capital growing modestly.
What it means in practice
The data confirms what we observe on the ground: search funds have evolved from a niche MBA pathway into a recognised strategy for acquiring and scaling quality businesses with strong fundamentals, while also providing a solution to the succession challenge faced by SMEs globally.
The compression in holding period deserves attention. A shorter path to liquidity is welcome for investors, but it sits in tension with the reason many owners choose a searcher over a financial buyer in the first place — the promise of an operator who will stay. We read the numbers as a reminder that the model works when the entrepreneur's timeline and the company's timeline are the same one.
At Arada Capital Partners we are committed to these evolving best practices as a professional, internationally focused search fund investor. We partner with exceptional entrepreneurs across geographies, providing not only capital but strategic guidance and operational support to drive sustainable, long-term value creation.