Ian Reynolds: 8 Years, 8 Portcos Since Starting Search
Ian Reynolds of Thesis Capital reflects on 8 years building 8 portfolio companies, from self-funded searcher to Top 20 independent sponsor.
Ian's first acquisition, a self-funded search deal, was a software and services deal in 2017. That deal produced strong returns and gave Ian a foundation to build further. Ian saw that many capable people, such as bright MBAs, industry operators, and managers outside of private equity, wanted to buy and build companies, but lacked the structure or M&A expertise to execute. Thesis Capital was built to fill that gap, serving as both partner and platform for entrepreneurial leaders ready to step into ownership.
The firm's model is centered on people. Thesis looks for "extraordinary" individuals whose character and behavioral traits align with its culture of partnership and discipline. For every 300 people they speak with, 1 becomes an Executive in Residence. The focus is on identifying a person's innate gifts and pairing them with industries that match those strengths. Thesis is building people at the same time it is building businesses.
Among its investments is a platform in Puerto Rico, where Minds Capital invested. Puerto Rico apparently produces ~17% of US pharmaceuticals. The opportunity offered pricing power and geographic insulation, but limited total market size. Debt capital was difficult to secure, as lenders hesitated over geographical concerns, so Thesis engaged an investment banker to source the right partner. Ian claims such capital raisers typically charge 1-2% of EV, a worthwhile cost, he states, to ensure alignment and execution certainty.
Ian has watched the search fund ecosystem change. Investors who once favored stable, "boring" businesses targeting 3x MOICs now chase tech-enabled opportunities that can deliver outsized wins, but carry greater risk. The model has drifted toward venture capital logic, where 1-2 portfolio stars carry the returns. That shift has made outcomes more polarized, and less favorable for the searchers themselves, whose median results are now meaningfully lower than in the past.
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