Stanford's 2026 Search Fund Study puts aggregate IRR at 33.9% and ROI at 4.75x across 862 core search funds, and it also shows how sharply those returns concentrate once you take out the biggest outcomes. That combination is why diversification and manager selection matter as much as the headline number.
A search fund backs an operator to find, buy and run one profitable small business. The search check is small. The acquisition check is the real position. For founders and angels watching who buys established companies, that model sits next to venture and buyout rather than replacing either one.
If you want the full allocator read, including how access funds work and what diligence questions to ask, see the VC Lab guide on search fund investing for institutional allocators. Individuals and family offices can start with the individual and family office search fund guide.
VC Lab is a community of 1,000+ investors in over 88 countries. This article is for educational purposes only and isn't investment advice.
