Search Strategy & Buyer Profile
Before you start looking for a company, you need to be clear about your goals, your budget, and your strengths. This module will help you define your buyer profile and use the right search channels.
1 Why Create a Buyer Profile?
Professional buyers, such as financial investors, know this: Without clear search criteria, looking for a company is like looking for a needle in a haystack. Most private buyers make the mistake of sending out indiscriminate inquiries to dozens of companies and end up getting bogged down. You invest time in companies that are highly unlikely to be a good fit, and in doing so, you overlook the truly relevant opportunities.
What a buyer profile does
Focus – You know what you’re looking for and filter systematically instead of clicking randomly
Efficiency – Sellers and advisors immediately recognize whether you’re a serious prospect
Self-reflection – You determine in advance whether you have the necessary skills and resources for the type of company you’re targeting
Negotiating position – Those who know their profile come across as more professional to sellers
Demographic change means there are more businesses for sale in Germany than ever before—but the number of prospective buyers is growing even faster. This means you’re competing with many other buyers for the best deals. A clear buyer profile and a professional presentation will help you stand out from the crowd.
M&A advisors often handle many sale projects at the same time and list them on various platforms. They quickly recognize when a buyer is sending out dozens of inquiries indiscriminately—and mentally write off such prospects. The result: Your inquiries will no longer be taken seriously, and you will no longer be considered for current or future transactions. Quality trumps quantity —contact only companies that truly match your profile.
2 Define Your Buyer Profile
Your buyer profile answers the key question: Which company is a good fit for me? And just as important: Which one isn’t? The following factors will help you systematically determine this.
Budget and Deal Size
Your available equity determines which companies are realistically in the running for you. As a rule of thumb, the bank expects an equity ratio of 20–30% of the purchase price. You finance the remainder through bank loans and grants.
One crucial point that many buyers overlook is this: A seller loan counts toward this equity ratio, not toward the remaining portion financed by debt. For the bank, it is subordinated capital and is therefore on par with your own money. As a result, your own contribution may end up being smaller than the ratio initially suggests.
Without a seller’s loan: With a 20% equity ratio, you must contribute the full 20% yourself. With €150,000 in equity, purchase prices up to approximately €750,000 are realistic
With a seller’s loan: If the seller defers 10% of the purchase price, you only need to contribute 10% yourself. The same €150,000 can then cover a purchase price of up to €1,500,000
Don’t forget the transaction costs (lawyer, tax advisor, due diligence, brokerage commission, notary, etc.)—expect an additional 5–8% of the purchase price for small deals. You’ll need this money on top of everything else, and it’s gone even if the deal falls through
Industry and Business Model
Industry experience —Do you have experience in a specific industry? This makes getting started much easier and gives the seller the confidence that their life’s work will be in good hands
Business Model Type – Services, manufacturing, retail, software? Each model has different requirements
Region and Location
Some business models (e.g., e-commerce) are location-independent, but most (e.g., skilled trades, restaurants, manufacturing) are strongly tied to a specific location
Answer this question honestly: Are you really willing to relocate? If not, you’ll need to define a clear search radius (distance in kilometers or, better yet, travel time) and focus only on businesses that fit within it
Personal Strengths and Weaknesses
Not every business is a good fit for every buyer. Ask yourself honestly:
What leadership experience do I have?
Can I lead a team of 5, 20, or 50 employees?
Am I stronger in operations or strategy?
How much time can I invest in the first 12–18 months after the acquisition?
First, determine your available equity. This will determine your maximum deal size. And that, in turn, will determine the revenue and profit margins of the companies that are realistically viable options. Don’t look for dream companies—look for companies you can afford.
Back-of-the-envelope calculation: What can you afford? Your equity: € Without a seller’s loan (20% equity ratio) Max. purchase price – Target’s EBIT margin – With a 10% seller’s loan (10% equity + 10% seller’s loan) Max. purchase price – Target’s EBIT margin – –
3 Where can you find companies?
There are various channels through which companies are listed for sale. Use several at the same time to maximize your chances.
M&A platforms
Platforms are particularly well-suited for smaller deals where no advisor is retained—and that’s exactly what DUB specializes in
DUB – With DUB, you already have access to the majority of relevant deals in the German SME sector. Create a buyer profile, set search criteria, and receive alerts for matching listings
DealCircle – Access to sale projects that aren’t publicly listed on platforms. You enter your search criteria and will be proactively contacted as soon as a suitable project becomes available
M&A Advisors and Succession Planning Advisors
For purchase prices of approximately €1–2 million or more, M&A advisors are often retained by the seller
In addition to their platform projects, advisors often have other ongoing mandates that they do not publicly advertise
Check in regularly with relevant consulting firms to inquire about ongoing projects—those who stay visible will be contacted first when suitable mandates arise
Networking and Direct Outreach
Chambers of Industryand Commerce (IHK) and Chambers of Crafts —offer succession exchanges and events
For larger deals with a purchase price of €5–10 million or more, professional buyers also reach out directly to target companies and utilize intermediaries such as tax advisors and attorneys who advise business owners who are considering a sale but are not yet actively seeking one
Most buyers underestimate how long the search will take. Expect it to take 6–18 months before you close a deal. If you’re buying under time pressure, you’ll end up compromising on quality. Start your search early and be patient.
4 Setting Search Criteria Correctly
Once you've defined your buyer profile, translate it into specific search criteria—on DUB and other platforms.
The most important filter criteria
Industry/Keywords – It’s worth taking the time to compile all relevant terms for your target industries—the more precise your keywords, the better the results
Region – Radius or specific states
Revenue range —minimum and maximum, based on your budget
Earnings (EBIT) —Filter by the company’s profitability, based on your rough estimate
Number of Employees – Gives you an indication of the complexity of the acquisition
Search Alerts
The most efficient way to monitor the market is through automated search alerts. On DUB, you can save search criteria and receive email notifications when new listings match your criteria. → Create a search alert now
Check regularly to see if your criteria are yielding too many or too few results—and adjust them accordingly
Respond promptly to interesting listings—good companies are snapped up quickly
Don't set your search criteria too narrowly. Many of the best deals are just outside your initial expectations—for example, an industry you hadn't considered or a location a little farther away. Keep an open mind, but stay within a clear framework.
5 What documents do you need as a buyer?
Once you’ve found a company that interests you, you’ll need to introduce yourself to the seller or their advisor. You’ll be asked to provide certain documents—sometimes as early as the initial contact, but no later than before signing an NDA or an LOI.
An Overview of Your Buyer Documents
- Resume (CV) – Professional background, relevant experience, leadership roles. Salespeople want to know if you can lead the company.
- LinkedIn Profile – Sellers and consultants expect a professional, fully completed LinkedIn profile. It’s often the first impression a seller gets of you—make sure it clearly conveys your professional background and credibility.
- Personal Statement / Buyer Profile – Short document (1–2 pages): Who are you, what are you looking for, and why are you the right buyer? Includes your motivation, industry experience, and acquisition strategy.
- Proof of Funds – Bank confirmation or statement of assets showing that you can financially support the transaction. It does not need to cover the full purchase price, but your equity contribution should be credibly documented.
- Financing Term Sheet – A project-specific document obtained for a specific company that is already under review. The bank evaluates the specific target company and issues a preliminary financing commitment. This provides the seller with assurance that the deal will not fall through due to financing issues.
- References – Optional, but helpful: contacts who can confirm your experience and professionalism (e.g., former business partners, tax advisors).
When do you need which document?
Initial contact / expression of interest: A resume and cover letter are sufficient for now
After the NDA / before the LOI: Proof of equity is often expected
LOI phase: A financing term sheet significantly strengthens your negotiating position
Sales consultants screen prospective buyers based on whether they can finance the deal. Those who cannot provide proof of equity are often not even invited to an interview. Set yourself apart from the crowd by proactively providing the seller’s side with proof of equity.
- Clear Criteria = Better Chances: If you define your search criteria precisely, you won’t waste time on unsuitable deals—and you’ll significantly increase your chances of success
- Equity = Deal Size: Your available equity determines the maximum purchase price limit
- Use multiple channels: Utilize platforms, advisors, your network, and direct outreach simultaneously
- Have your documents ready: Prepare your resume, cover letter, and proof of equity from the very beginning
Answer 5 questions about search strategy and buyer profiles. All answers must be correct to complete the module.
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