The Hot New Trend of Entrepreneurship Through Acquisition
It arrived exactly when the market needed it
A few months ago, a founder I know pulled me aside after a closing dinner. He had just sold a business he’d run for twenty-three years. Solid margins. Loyal customers. No drama.
His buyer was thirty-four.
MBA. Former operator. Backed by a small group of investors. Calm. Prepared. Obsessed with the fundamentals of the business he was buying, not with “disruption.”
The founder leaned in and said, almost quietly, “Ten years ago, I wouldn’t have believed someone like him even existed.”
That reaction is becoming common.
Entrepreneurship Through Acquisition, or ETA, is suddenly everywhere. MBA programs. Podcasts. Conferences. Capital allocators. What used to be a niche path for search fund nerds has become a mainstream route to ownership.
That popularity has people uneasy.
ETA is not about buying companies faster; it’s about buying companies that were built to outlast their founders.
When something gets hot, founders worry about froth. Buyers worry about competition. Advisors worry about unrealistic expectations. Everyone has seen what happens when enthusiasm outruns reality.
The skepticism is understandable. Not every trend deserves respect. But ETA isn’t hot because it’s fashionable. It’s hot because it works, and because it quietly solves problems that have been building for decades.
Participation in flagship ETA programs has more than doubled since 2019 at schools like Chicago Booth, with course enrollment rising from 64 students in 2019–20 to 135 in 2023–24¹. Stanford’s 2024 Search Fund Study reported 94 new search funds launched in 2023, with roughly 63 percent successfully acquiring a company². Booth’s ETA conference drew more than 700 attendees in 2023, and the ETA Insider Podcast logged nearly 50,000 plays that same year³.
Capital followed for a reason. Across hundreds of search funds since the 1980s, average internal rates of return sit around 35 percent, with an average 4.5x multiple on invested capital⁴. Nearly seven in ten acquired companies have produced positive returns⁴. That kind of consistency keeps institutional money interested long after the hype cycle should have faded.
But statistics don’t explain the real pull.
The operators I speak with aren’t chasing financial engineering. They’re chasing the chance to run something real. ETA offers a fast track to the CEO seat without pretending the early years will be easy. You inherit customers, staff, systems, and cash flow, then earn your upside the hard way: by stewarding what already works.
For sellers, this changes the exit landscape in a subtle but important way.
The ETA buyer is not a flipper. They are usually betting their entire career on one platform company. They care deeply about whether revenue is transferable, whether key people will stay, and whether the business can run without heroic effort from the founder. Clean financials matter. Repeatable processes matter. Culture matters.
I’ve watched founders who once dismissed searchers as “kids with spreadsheets” come to prefer them over strategic buyers. Not because they paid more on day one, but because they listened better, structured deals more thoughtfully, and treated legacy as an asset rather than an inconvenience.
Here’s the counterintuitive part: ETA doesn’t reward novelty. It rewards durability.
Most acquired companies in the search fund universe are not sexy. They are service businesses, healthcare-adjacent firms, tech-enabled niches that throw off steady cash and need continuity more than reinvention. The buyer’s job is not to break them. It’s to not be the point of failure.
That mindset aligns cleanly with long-term exit thinking. A business built to be transferable is one that produces options. Even if you never sell, you operate differently when the company could survive you.
This is where some critics miss the mark. They argue ETA will crowd out founders or compress valuations. In practice, the opposite often happens. A broader buyer universe forces clarity. It rewards owners who invested early in systems, people, and reporting. It exposes businesses that were propped up by founder heroics.
The demographic tailwind makes this unavoidable. A wave of baby boomer retirements is pushing more small and mid-sized businesses toward the market, particularly in services and healthcare⁵. Globally, ETA structures have expanded into roughly forty countries, with more than 140 international acquisitions tracked by late 2023⁶. This isn’t a fad confined to a few U.S. campuses.
ETA is not a shortcut. It’s a different starting line.
For aspiring acquirers, that starting line comes with pressure, governance, and accountability from day one. For founders contemplating exit, it introduces a buyer who is motivated, coached, and backed by patient capital that understands compounding.
And for the ecosystem as a whole, ETA is doing something rare. It’s reconnecting entrepreneurship with stewardship.
That’s why it feels hot. Not because it’s new, but because it arrived exactly when the market needed it.
David Hermann, CEO of hermanngroup and M&A Advisor/Broker at Sunbelt Business Brokers of Colorado
David Hermann is the advisor founders call when the stakes are real. As CEO of HermannGroup and an M&A Advisor with Sunbelt Business Brokers of Colorado, he helps owners turn complex businesses into valuable, sellable assets and navigate exits without regret. His work has driven over $500M in documented financial improvements, blending strategy, change leadership, and deal execution into decisions that actually compound. If you’re thinking about growth, transition, or exit, you’re already late to the conversation.
Sources
¹ University of Chicago Booth School of Business, ETA Program Enrollment Data
² Stanford Graduate School of Business, 2024 Search Fund Study
³ Chicago Booth ETA Conference & ETA Insider Podcast metrics
⁴ Stanford Graduate School of Business, Search Fund Returns Analysis
⁵ U.S. Small Business Administration, Demographic Ownership Data
⁶ IESE Business School, International Search Fund Research