A Detailed Analysis of ETA CEO Demographics and Financial Outcomes
Daniel Lazier, Jacob Thomas, A. J. Wasserstein. (2026)
Yale Case, no number printed, January 30, 2026
Sample. "we solicited a broad range of serial ETA investors for unmasked data. We ultimately received information from six investors on companies in their portfolios that have fully exited; there are no interim mark-to-market valuations, and all firms are categorized as traditionally funded searches." (p3). "we netted a robust dataset of 155 unique observations" (p3). Investors supplied company name, CEO name, IRR and MOIC; the authors added MBA school, work history, partnership status, gender and military background from LinkedIn and other databases. 139 U.S. and Canada, 16 elsewhere. Vintages and investor names: not stated. Included and excluded. "Additionally, our study does not include self-funded search funds." (p25). Excludes broken searches ("which typically account for about 35% of all initial search investments", p4) and companies still operating. Coverage: "168 traditional search funds have exited. In other words, we are capturing a material portion (92%) of the known ETA population that has sold." (p3), with the same not-apples-to-apples caveat because 16 are outside the U.S. and Canada. Headline numbers. Full sample (figure, p3): mean IRR 17.8%, median IRR 24.9%; mean MOIC 4.1x, median 3.0x; first quartile 2.6% and 1.2x, third quartile 46.1% and 5.1x; maximum 169.8% and 47.3x; n = 155. "MBAs have a higher median IRR (28% compared to 1%)" with MBA n = 141 and no MBA n = 14 (p6). "61 observations, or about 39% of the search funds we studied, involved partnered searches" (p4); partnered "median IRR of 32% for the segment, compared to 24% for solo initiatives." (p11). "the median and mean IRR for ETA projects outside the U.S. and Canada are 9% and negative 8%, compared with 28% and 21% for U.S. and Canadian funds." (p15). "we only had six observations of search funds led by at least one female" (p15). Multivariable regression: "Search funds in the U.S. or Canada have IRRs about 36 percentage points higher than those in other regions, after controlling for education, experience, and industry focus. This finding is statistically significant at the one-percent level" and no-MBA searchers "underperform their MBA-trained counterparts by approximately 25 percentage points in IRR" at the five percent level (p22). "The R-squared of 0.257 ... the adjusted R-squared is 0.114." (p21). School, partnership, prior profession, military service, gender and software focus are not significant in the joint model. Limits. Authors: "the mean and median IRRs and MOICs are unweighted arithmetic calculations, not dollar-weighted figures." and "these IRRs and MOICs are structurally inflated compared to a broad pack of operating and exited ETA firms, which also includes broken searches." (p4); "we present patterns and trends, but readers and we should refrain from ascribing causation." (p2); survivor bias and small cells acknowledged (p25). Reader's notes: final model reached by dropping variables that "did not significantly contribute" (specification search); no vintage or holding-period controls; small cells (female 6, no MBA 14, non-U.S./Canada 16); single-variable comparisons are untested.