LenderHawk analysis. Not affiliated with or endorsed by Search Funded: The ETA Podcast.
Ibrahim Abdalrahim of Moonbase Capital returns to map how search funds have expanded beyond Europe into Brazil, India, Japan, Poland, Portugal, and other markets. He argues that the biggest risks are no longer just fundraising or sourcing, but governance quality, board composition, and whether investors actually add hands-on value after the close.
ETA investors, searchers, and board members who want a practical read on how global search markets differ and why board quality may matter more than capital availability.
Search activity has spread far beyond the US, with especially rapid growth in Europe, Brazil, India, and parts of Asia.
Spain is described as the busiest and strongest search market outside the US, while France remains harder because of cultural skepticism and stronger PE competition.
Brazil and Mexico rely more on seller notes and less on heavy debt structures, so deals there often look more equity- and relationship-driven than European acquisitions.
Japan’s high leverage and seniority norms make local fundraising more common and make it harder for young searchers to approach older founders directly.
The main investor risk is not putting capital into searchers but failing to provide active support during diligence and post-close board work.
Boards can fail when big-ticket investors want seats for signaling reasons rather than because they have time, operating experience, or a real relationship with the searcher.
Searchers should build boards for merit and diversity of skills, not just for check size, because the company may need operational, financial, sales, and industry-specific support at different stages.
Scaling the model is difficult because investors must be highly involved; a passive search-fund investor model can weaken the economics even if fundraising and deal flow keep growing.
Moonbase views the search-fund world as three linked pillars: searchers, SMEs, and investors. Growth in any one pillar matters, but the model only works when all three continue to function together.
When to use: Useful when assessing whether a country or region is truly ready for a sustainable ETA ecosystem.
A search-fund board should be assembled for complementary value, not by ticket size. The board should blend experienced investors, newer hands-on members, operational operators, and domain-specific expertise.
When to use: Use this when selecting board members for a newly acquired company.
Moonbase’s first vehicle was roughly 90% focused on Europe, with about 10% outside Europe.
Abdalrahim describes how the firm’s geographic mix has broadened over five years.
In France, Moonbase initially invested in roughly the fourth or fifth searcher in the country’s history.
He uses France to show how early the market still is in some European countries.
Spain is now the busiest and most active search market outside the US, in his view.
He cites Spain as the strongest non-US market he sees today.
Moonbase says investor tickets in search funds can range from about €500,000 to €2 million.
He uses this range to explain that value-add matters more than capital size.
He estimates Europe has enough SMEs that roughly 90% of businesses are in the SME category.
He uses that concentration to argue that the acquisition supply remains durable.
At one Bocconi event and one Rotterdam event, the search community had already grown enough to support large dedicated gatherings.
He points to university events as evidence of accelerating searcher formation.
Japan’s leverage levels are high enough that investor ticket sizes become relatively small.
He explains why Japan is harder for foreign investors to underwrite in the same way as Europe.
Choose board members based on the specific value they will add, not on who wrote the largest check.
Why: The company needs real support after closing, and big investors may not be the right people if they lack time or operating usefulness.
Build a board with mixed experience levels rather than only veteran investors.
Why: Experienced members bring stability while newer members may have more bandwidth and closer day-to-day involvement.
Include operational talent on the board, not only financial investors.
Why: New CEOs in search deals usually need help with hiring, execution, and operating decisions, not just capital oversight.
Rotate board composition over time instead of keeping the same people for the full ride.
Why: Different growth stages require different skills, and long-tenured boards can become less useful after the first couple of years.
Be transparent and direct with other investors rather than talking about them behind their backs.
Why: The market depends on trust, and unspoken conflicts reduce value without improving anyone’s behavior.
Abdalrahim says Moonbase invested in only the fourth or fifth searcher in France, but the market later became far more active. He uses that arc to show how quickly a country can move from novelty to a functioning ecosystem.
Lesson: Early-stage market depth can change quickly, so early underdevelopment should not be mistaken for permanent saturation.
He says German founders tend to be more established and proud of legacy, which makes them harder targets for younger searchers. That cultural barrier, more than just deal supply, explains why some markets appear closed at first.
Lesson: Search success can depend as much on founder culture as on capital availability or company quality.
He contrasts search-fund boards with private equity boards, arguing that weak search boards create real downside when a company struggles because investors may not step in operationally. In his view, the model breaks when board members are present for signaling but absent when execution gets hard.
Lesson: The true test of a search investor is not closing support but crisis support.