Search Fund Jargon Translator

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

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Internal Rate of Return (IRR)

The annualized rate of return that makes the net present value (NPV) of all cash flows (both positive and negative) from a particular investment equal to zero.

Indication of Interest (IOI)

A preliminary, non-binding proposal from a potential buyer to a seller, indicating a potential valuation range and interest in pursuing an acquisition.

Indemnification

A contractual obligation of one party (the seller) to compensate the other party (the buyer) for specified losses or damages that may arise from a breach of representations and warranties.

Intermediary

A firm or individual that acts as an agent for a business owner to manage the sale process of their company.
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