Search Fund Jargon Translator

Clear, plain-English definitions of ETA and dealmaking terms, with practical notes and examples.

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Entrepreneurship Through Acquisition (ETA)

The process of becoming an entrepreneur by acquiring and leading an existing business, rather than starting one from scratch.

Earn-out

A form of deferred payment to the seller, contingent on the business achieving certain performance milestones after the closing.

EBITDA

A measure of a company's overall financial performance, used as an alternative to net income in some circumstances. It is a proxy for operating cash flow.

Exclusivity Period

A legally binding provision in an LOI where the seller agrees not to solicit or negotiate with any other potential buyers for a specified period.

Escrow

A portion of the purchase price held by a neutral third party (an escrow agent) for a specified period after closing to cover potential indemnification claims.