Introduction
In this exclusive Q&A, Jonathan Bournigal shares how he successfully executed a search fund strategy in the small Dominican Republic market. After returning to his homeland following business school, he adapted the traditional US search fund model to fit local conditions, acquiring businesses like Bunker (document storage) and creating a regional powerhouse. Learn how he navigated unique challenges of buying business small market opportunities and transformed small acquisitions into market-dominating enterprises.
Founder Success Story QnA
How did you decide to do a search fund in the DR back in 2013?
I never knew about the search fund model until I went to business school and that’s ultimately when I connected my past and my training which was Investment Banking. Understanding how to run an M&A deal, what valuation is and everything. Being from the Dominican Republic and growing up, I always wanted to find my way back to my country but had no idea how to do it. I had been in the US for about 10 years and when I heard of the search fund model, it quickly clicked that it’s not that I should be looking for a job, it’s that I should be creating my own job. Everything clicked after that and I understood I had to go out and create my own destiny.
You’ve got essentially no accent, give us more on your backstory.
I moved around between DR and the states during my early childhood so I actually got alphabetized in English before I did Spanish. English is quasi my first language which is why you probably don’t hear much of an accent. The 10 years was actually the time between me going to undergrad, then doing four years of investment banking and two years of MBA. So when you add all that up, it would have been 10 years. Yes, I worked at Citi in M&A covering financial institutions for LATAM.
Why entrepreneurship through acquisition as opposed to starting a business in the DR?
I went to Babson College and that’s a big entrepreneurship school, but the idea of starting from zero never really connected with me. I always saw myself as very finance-driven, looking at analyzing financial statements and businesses. I was more of an analyst than a builder. Starting a business never crossed my mind besides doing those startup idea exercises in business school just to get it out of my system. For me, the idea of buying and the whole branded way of calling it entrepreneurship through acquisition made me feel like I had found my mold because I was entrepreneurially trained at Babson and then acquisition trained at banking. It was a search-market fit.
How did your search thesis take shape for the Dominican Republic market?
I learned about the business model second year of my MBA and went head first into it. I was able to take Rick and Roy’s course. The first thing was deciding between self-funded or funded search. For me, it was clearly to do a funded search. Then I had two choices: do I try to bring established search fund investors to the Dominican Republic, or do I look for local investors and sell them on this innovative investment model? I went for the latter. I thought investing in a small country where traditional search fund investors didn’t have experience might be uphill. They might ask complicated questions that would make fundraising difficult. I wanted angel search fund investors who knew the lay of the land. Luckily, it was one of those things where they loved the idea right away. They were businessmen who fielded many investment opportunities but lacked someone to operate businesses after investment. The idea of me buying and running a business was perfect for them. The funded search model with the Stanford primer was a simple way to document everything saying ‘this is the cookie cutter model, let’s do this.’
What can others learn from how you found capital providers in a non-US market?
They were existing relationships, though not deep ones developed during my early professional years. Some were people who, when they heard I left banking to do an MBA, said ‘keep in touch, we’d love to know what you do after business school.’ That was a great transition point. Honestly, I was lucky to find such great investors – my hit rate was like five out of six. You build a pipeline thinking you’re going to pitch 100 times, but I was lucky to find interest in the few I pitched first. It was a bit of existing relationships, and a couple brought in other investors like a club deal. Twenty percent of my fund actually came from a forwarded email with a reply saying ‘count me in for my 20%.’ A lot of capital raising is about having an anchor – once I had that, I got momentum and it became much easier from there.
How did you tackle finding businesses to buy in the Dominican Republic market?
Searching in a small market is difficult because the whole search fund thesis is around retiring Baby Boomers, which is a very US-centric model. In the DR, we don’t have many baby boomers. My thesis started as looking for family businesses at generational transition points, but this didn’t hold water. Family businesses are extremely different than solo-owned businesses. In DR, future generations are trained to be part of the family business. It’s like a plant that spreads deep roots, which makes deals difficult because you have to convince multiple people instead of one sole owner. The sales cycle becomes much longer. I stopped trying to land big family businesses and started looking for opportunistic situations like partnerships splitting up or foreigners selling businesses. Proprietary deal flow through networking became key – you can’t call on 200 businesses like in the US model because your reputation as a tire kicker forms quickly in a small market.
What did you find through your creative networking approach?
I ended up buying two businesses three months apart. The first was a document storage business called Bunker. I’d never learned about document storage before, but I found a deal in Panama for the largest document storage business there. When I went through the business model, I fell in love with it. I realized it was a very high multiple business – these don’t trade for 4X, which is one pitfall of the search fund model as they engrain that you should buy at 4X. When I learned about document storage, I realized I should look for 10X businesses and try to buy them at 5-7X. The second business was a billboard business in DR. I actually bought two and then met with two other billboard businesses to merge them. My contribution to the four-way merger was the two businesses I bought. Document storage and billboard businesses typically trade at double-digit EBITDA multiples, so I focused on good deals where I could grow rather than fixating on ‘can’t pay more than four times.’
How did you grow the document storage business which had ‘maxed out’ growth?
The idea of storing documents elsewhere was novel in DR – super common in the US but unknown here. One of the companies had AAA-rated clients while others had ‘everybody else.’ I bought the one with AAA clients but realized they were capacity constrained. This is a real estate business needing space and racks. They were at capacity with no plans to expand – owners were taking cash off the table annually. Our mindset was the opposite: there’s product-market fit, we need to refine it. We designed infrastructure for a business worth 5-6-7X its size. We built a 40-foot high, 50,000 square foot facility. I took potential large clients to see the construction site, doing a ‘before and after.’ When they saw the vision, they realized they could get 40% savings while storing in prime conditions. Business process outsourcing is all about scale – by pulling everyone’s documents, we could operate more efficiently and pass those savings to clients.
How did you decide how big to build the facility when you only had one shot?
I learned from an early mistake – we ran out of space within two weeks of owning the business, creating a logistical nightmare with multiple sites. The idea of ‘we’ll own multiple sites’ crumbled quickly. You don’t want boxes scattered everywhere – it’s a nightmare to coordinate when clients need multiple boxes from different locations. As a searcher, I was always pitching and networking. I developed a relationship with someone who fell in love with my search idea. His family owned a piece of real estate on the main highway in Santo Domingo. I asked what they’d do with the 300,000 square feet behind it that they didn’t even know they owned. We sat down with an industrial architect and designed to spec. We needed 170,000 gallons of water in a cistern to comply with fire codes – something impossible to add later. Luckily, this was a greenfield opportunity. They became our real estate partners, building the warehouse and giving me a 20-year lease without a deposit. To this day, I still haven’t given them a deposit after eight years – that’s how much trust-based it was.
How did you characterize this as a growth equity opportunity versus typical search?
I’d compare it to LBO or buyout in private equity where you’re buying stable cash-flow businesses, doing financial engineering with debt and equity. Growth equity is for situations with high growth where you need to put more capital to work to feed the growth until reaching steady growth. That’s how we saw the opportunity – buying something small but growing it much bigger. Comparing to ETA comp: a lot of times searchers look for a business with about $2 million EBITDA. But what if that business grows only 7-8% annually versus a $500,000 EBITDA business growing 20% annually? Ultimately, you can create the same absolute return in both scenarios. You just have different playbooks. For non-finance people, it’s important to understand opportunity types. If you’re a good salesman, don’t be scared of a smaller deal – high growth will cure overpaying and dysfunctional partnerships. High growth will cure a lot of things.
What was your four-prong transformation strategy for the business?
The first was physical real estate and infrastructure – we talked about that. Second was building middle management. The company didn’t have middle management – it was the operating partner and field technicians. I needed a project manager to onboard clients after sales. I told my brother-in-law to introduce me to promising Industrial Engineering classmates. I met Helen (who’s still with me) and she signed up the next day. Caroline, our finance manager, came from an investor’s family office. She was already trained on the ERP system we plugged into, which was a huge win. Then I found Millie as operations manager. Three women formed our core management team. In markets like DR, talented young people often don’t get opportunities, so we were clear: without building a middle management team, we couldn’t grow exponentially. Owner-operators make limited decisions annually, but with empowered middle management, decision-making becomes exponential and compounds year over year. Eight years later, zero attrition – they’ve grown financially and professionally.
Jonathan Bournigal Business Stats
Jonathan’s strategic acquisitions and growth approach transformed small businesses into market-leading enterprises. Starting with less than $1 million in EBITDA, he grew operations significantly while expanding market dominance in the Dominican Republic. Today, his ventures command substantial market share across multiple sectors in the Caribbean region.
- Acquired businesses with less than $1M EBITDA in initial transactions
- Grew document storage business to six times original box storage capacity
- Now controls approximately 85% of Dominican Republic document storage market
- Expanded to become largest operator in the Caribbean region
- 8+ year hold period demonstrating long-term value creation
- Successful merger of multiple billboard businesses into regional player
| Business Metric | Initial Acquisition | Current Status |
|---|---|---|
| Market Position | Niche player | Market leader (85% DR share) |
| Facility Size | Small inefficient warehouse | 50,000 sq ft modern facility |
| Client Base | Limited to local businesses | Major BPO operators across region |
| Technology | Excel-based tracking | Enterprise warehouse management |
| Management | Single operator | Professional middle management team |
Jonathan Bournigal Method
Bournigal’s approach to transforming small market acquisitions centers on strategic adaptation of the search fund model to local conditions. His methodology focuses on identifying high-growth businesses in shallow markets where traditional search fund approaches fail, then implementing structured growth strategies that leverage both operational improvements and strategic scaling.
- Adapted US search fund model to fit small market dynamics instead of forcing standard approach
- Targeted high cash-flow businesses trading at premium multiples rather than forcing 4X deals
- Leveraged deep networking through personal connections rather than cold outreach
- Implemented four-prong transformation: infrastructure, management, product, and digital
- Focused on building middle management teams to exponentialize decision-making
- Targeted business process outsourcing clients for scale advantages in document storage
- Created proprietary deal flow through trusted relationships in small market
Jonathan Bournigal Tools
While Bournigal emphasizes relationships over tools in small markets, he strategically implemented key technologies during business transformations. When acquiring the document storage business, he recognized outdated systems were limiting growth potential. The transition from Excel-based tracking to enterprise solutions marked a critical inflection point in operational capability and client trust.
- Enterprise Warehouse Management System – Industry-specific system replacing Excel, enabling precise box location tracking and chain of custody
- ERP Integration – Leveraged existing finance manager’s expertise with investor family office’s ERP system for seamless implementation
- Sales Visualization Tools – Used construction site visits as powerful sales tool to demonstrate future capacity to potential clients
- Business Process Outsourcing Framework – Created scale advantages by consolidating document storage for multiple companies
- Network Mapping – Utilized father’s professional connections (as cardiologist) to access senior business leaders
Key Notes
Jonathan’s journey reveals critical insights for entrepreneurs considering acquisition opportunities in non-US markets. His experience highlights how traditional search fund assumptions must be adapted to local conditions while maintaining core investment principles. These observations capture the most valuable takeaways from his successful small market acquisition strategy.
- In small markets, relationships are everything – reputation spreads quickly both positively and negatively
- Traditional US search fund theses (like targeting retiring Baby Boomers) often don’t translate to smaller economies
- Family businesses operate differently in small markets with stronger succession tendencies
- Multiples may be higher in small markets due to lack of liquidity and price discovery
- Seek out businesses with 10X potential trading at 5-7X rather than forcing 4X deals on inappropriate businesses
- Building a middle management team is essential for exponential growth and decision-making
- Don’t buy real estate with the business unless strategically essential – it becomes a value destroyer
Get Started in Just 5 Steps
Following Bournigal’s approach, here’s how to launch your own small market acquisition journey. These steps distill his decade of experience into actionable guidance for searchers targeting opportunities outside major US markets.