Alex Mears·June 2, 2022

What Searchers Can Learn from Big PE

This episode is an expert/advisor interview, not a buyer-operator story. Alex Mears, a 20-year large-cap PE veteran (Blackstone, Carlisle) and former Navy SEAL intelligence officer, joins host Will Smith to discuss the launch of Brydon Group, a search fund accelerator co-founded with serial operator Steve Ressler and sourcing specialist George Duteil. The conversation centers on applying big PE frameworks to search: evaluating business quality through the locus of competition, mission criticality vs. cost materiality, and customer stickiness; assessing seller integrity as a binary filter; managing key employee and regulatory compliance risk in diligence; and the structural advantages of an accelerator model (committed capital, shared deal flow, pre-built CRM/sourcing infrastructure, EIR salaries of $150k-$200k) over the traditional 10-20 investor syndicate approach. Brydon backs five EIRs per cohort with 90% of equity on traditional search fund terms (up to 25% carry to the searcher) and had already backed 70+ searchers with 40 closed transactions at time of recording.

Deal facts

notes: No specific deal discussed. Guest is an investor/accelerator founder, not a buyer-operator. Brydon Group backs searchers with 90% of equity; searcher EIR salary range $150k-$200k during search phase; up to 25% equity to searcher on traditional terms. Collective track record: 70+ searchers backed, 40 closed transactions, ~30 actively searching.

Why this business

Alex Mears left Carlisle to co-found Brydon Group because he saw a unique opportunity to build something valuable for searchers by combining big PE deal/diligence expertise (his background) with deep operating experience (co-founder Steve Ressler) and elite sourcing skills (co-founder George Duteil). He describes it as opportunistic rather than a lifelong entrepreneurial ambition: 'This was such a unique opportunity and feeling like we could actually go build something really special and valuable for searchers.'

What's working

Thesis-driven searches outperform: higher deal close rates, higher IRRs post-close — Brydon structures its EIR program around this insight
Committed capital advantage: brokers and bankers who won't show deals to traditional searchers will engage with Brydon because it can credibly commit capital
Proprietary deal flow from the founders' networks is shared directly with searchers in relevant industries
Outsourced data-scraping/CRM infrastructure means EIRs start sourcing immediately rather than spending six months building a deal engine from scratch
Complementary founding team: PE deal expertise (Mears), multi-exit operating experience (Ressler), private-bank/outreach expertise (Duteil) — different skill sets, similar values
Deep due diligence framework from large-cap PE applied to small business: assessing locus of competition, mission criticality vs. cost materiality, and customer stickiness

What's hard

Traditional searchers face a months-long ramp to build their sourcing engine, then it goes to waste after closing — Brydon's accelerator model addresses this
Seller integrity is a persistent risk in small business acquisitions; information asymmetry can never be fully diligenced away
Key employee risk is often hidden until after signing — sellers resist buyer access to employees pre-close
Regulatory/compliance surprises (e.g., 'greening the workforce' in home care) can materially erode margins post-acquisition
Traditional investors in a 10-20 person syndicate often give ambiguous 'maybe' responses rather than clear thumbs-up/down, wasting searcher time and effort
Many small businesses compete only locally and are very difficult to scale; distinguishing scalable businesses from lifestyle businesses is hard
Manufacturing businesses require diligence at an international competitive level, which dramatically increases complexity

Notable quotes

The single most important thing in a business in terms of business quality is customer stickiness.

You want to find businesses that have so deeply integrated into the workflows of your customer set that it is incredibly painful, that's just incredibly difficult to extract.

There are millions of small businesses in this country, there are only thousands of great ones. Just go find a great one. It's not — and part of being great is having a seller who you can trust in terms of what they say when they sell the business.

If you put down three rocks and there's really ugly things under each of those three rocks, well guess what, all those other rocks that you weren't able to look under until you own the business — there's probably ugly stuff under those as well.