Inside David Ficadenti’s Aerospace & Defense Acquisition Search

David Ficadenti has partnered with Montage Partners, in conjunction with the firm’s Successor President Program, to acquire and operate an exceptional company as CEO to build a distinct platform. David has over 15 years of experience in the industrial and services industries, including as a Vice President at Honeywell, as well as an investment banker and private equity investor.

Several years ago, I decided to leave investment banking to pursue a corporate career, get closer to day-to-day business operations, and see how every aspect of a company operates to create value for its stakeholders. Before I made this career change, I briefly contemplated buying a small business and even purchased the HBR Guide to Buying a Small Business. I really liked the concept and read the book about halfway through, but ultimately decided it wasn’t the right time to pursue this path. Years later, after working at two Fortune 50 companies in a range of corporate development, finance, strategy, and P&L roles, I saw the book on my shelf and decided to finish my reading. My fascination quickly turned into an obsession. The prospect of leveraging my background in M&A, strategy, and operations to build a small company ignited a passion I had lost working at large companies.

My research began with search funds, a single-purpose investment vehicle to search for and acquire a private company whereby the leader of the search fund will serve as CEO post-acquisition. After researching similar structures and speaking with numerous investment funds and accelerators, I ultimately decided Montage Partners and their Successor President Program was the right fit. Montage has a 20-year track record of success in the lower-middle market and has made 19 investments since inception. In addition, Montage specializes in acquiring and investing in founder and family-owned businesses, which is by far the most prevalent owner archetype in my target size range.

Lastly, the most important factor for me was an alignment on values. I have interacted with many small companies and appreciate that founders and entrepreneurs have created a great business with compelling products and solutions. However, the magic that makes these companies successful is the culture and community that has been built, often over decades. Building upon an enduring legacy is core to my mission and an element I am bringing to the forefront of the next chapter of my career. Montage shares this core value and we have a similar mindset: we acquire companies but we invest in people.

The Best Advice I Received

The search fund community is full of enterprising, energetic, and helpful people that are willing to share information and insights as well as provide constructive feedback. Although I ultimately went a different route, the best advice I can give to those considering this path is:

• Search Funds are Not for the Faint of Heart: Searching for a company to acquire with no guarantee of success is fraught with ups and downs. You may be living off your savings in the meantime and there is no golden rule for how long a search can last. If your search is successful, the trials and tribulations are just beginning once you acquire a business. In addition, you will have investors relying upon you to preserve and grow their capital. Some of those investors may include yourself, friends, and family. Know thy self and be prepared to face adversity, rejection from business owners, and be committed to the journey of entrepreneurship.
• Go All-In: Searching is not a part-time endeavor. The chance of success from a part-time search is not zero, but it is certainly remote and exponentially less than a full-time effort. A search is a commitment to a fundamental career change and professional trajectory and not something to be done half-way. Would you invest in someone to acquire a business who wasn’t all-in?
• Find the Right Partner: You’ll run across many potential partners as you conduct your search. Different factors will weigh into your decision based on what’s important to you. Your number one criterion may be ready access to capital. Maybe it’s more important to you that they have a funded search model. It could be that a personal fit is most important. Understanding what your ideal partner looks like early on will help you choose wisely. You’ll be tied to your equity partner for years, likely facing many ups and downs in the business together. It’s not a decision to take lightly!