The Search Phase: The fund manager identifies and evaluates acquisition opportunities. This phase can last from one to two years and is both time-consuming and expensive, involving outreach to businesses to gauge interest in potential acquisitions.

The Acquisition Phase: The fund manager conducts due diligence, drafts legal documents, secures agreements, and gathers necessary information to process the deal. The acquisition is completed using capital, debt, or a combination of both. This phase can take a few weeks to several months, depending on the complexity of the business.

The Operational Phase: The fund manager actively improves business operations, reduces costs, and increases profitability. This phase involves implementing changes, optimizing sales and marketing, and can last several years or more as these improvements take effect.

Fund Managers generally have two primary ways of sourcing business deals:

Intermediary Outreach: Aggregators such as investment banks and brokers who are acting as the middle man for the business that want to sell. Websites such as BizBuySell is an appropriate example of how fund manage would use the Intermediary approach.

Proprietary Outreach: This outreach involves finding business via local listings and using sources such as YellowPages and Google. This outreach is extremely labour intensive and requires collaborative effort from different individuals for search fund managers.

For this exercise, Clouver has focused on helping search funds with their Proprietary Outreach reducing time and effort through automations served by Clouver.

Proprietary outreach involves reaching out to the business owners directly. As a fund manager, you need access to emails and phone numbers of key contact people in the organization to conduct reach outs. However, this information isn’t easily available.

Let’s consider an example:
As a fund manager, you are interested in buying HVAC business in the GTA (Greater Toronto Area). As a first step, you start to build a list of all the HVAC business containing key information for decision makers such as; name, email, phone number, number of employees, years in business, any unique business insight and other relevant information. However, you run into some roadblocks and start to ask yourself.

To solve this problem, most fund managers rely on virtual assistants or interns to manually search for companies on google, browse the website and using different sources such as linkedin or third party services to gather additional business details. However, this approach has several issues:

Time-Consuming Manual Process: Managing multiple resources, communicating requirements, reviewing spreadsheets, correcting errors, and repeating the process for different regions or search terms is time-consuming and labor-intensive. Onboarding new interns and virtual assistants requires starting from scratch, communicating the process, and spending additional time on training.

Unpredictable Success Rates: Without a systematic approach to gathering emails and owner information, it's hard to predict success rates. Random steps lead to unclear insights on what’s working and how to improve.

Inaccurate Data: Data sourced from websites may be unreliable, and pattern-matched emails can lead to inaccuracies, lowering the conversion rate.

Missed Opportunities: Spending more time on data collection than on outreach can result in missed opportunities, as search funds compete with other private equity firms and investment companies.

Resource Misallocation: Most of interns and virtual assistants time is spent on collecting data and then doing the outreach. This takes away from time that should be spent curating emails, making phone calls and connecting with prospects. The objective is to connect with businesses, gauge interest and get their before your competitors, not build lists.

Clouver is an automation platform that allows you to easily build your workflow automations to integrate your online services.

Our search fund customers are using Clouver to leverage Google Maps API to search for businesses in particular areas and save them to a database or spreadsheets. Once saved, Clouver also expands on the dataset by utilizing other integrations such as checking if the business’s website returns a success status or scraping to aggregate the social links of the business. Additionally, Clouver has integrations with Apollo IO and Snov IO’s apis, to fetch data of founders of the business as well as their emails. Several additional data integrations such as number employees or net revenue of the business is also easily configurable with Clouver.

Clouver simply allows you to aggregate different API data sources without worrying about the hassle of hiring or paying for an engineering solution. In doing so, search fund managers are able to allocate their internal resources and time to contacting business owners and closing deals for their fund.

Efficient Automated Process: Clouver automates data gathering, eliminating the need for managing multiple resources, communicating requirements, reviewing spreadsheets, and correcting errors. This saves significant time and effort, and there's no need to train new interns or virtual assistants.

Predictable Success Rates: Clouver integrates with tools like Google Maps, Apollo, Snov, and other scraping capabilities. Our systematic, API-driven approach ensures a predictable success rate, allowing continuous improvement and consistent results.

Accurate Data: Using APIs rather than pattern matching and manual entry ensures our data is accurate, enhancing the reliability and effectiveness of your outreach dataset.

Maximized Opportunities: As a search fund manager you can spend more time connecting with prospects and closing deals, and less time building lists. By reaching target businesses faster, you can stay ahead of the competition.

Optimized Resource Allocation: Allocate resources effectively by having interns and virtual assistants focus on high-impact tasks, such as reaching out to customers and prospects, rather than building lists. This ensures that your team is connecting with businesses and gauging interest before your competitors do.