Before you finance a single acquisition, you'll spend months, sometimes over a year, just searching. That phase has real costs, and underestimating them is one of the most common reasons a promising search stalls out.
The three buckets of search-phase cost
Living expenses. If you're searching full-time without a salary, this is usually the largest line item. Budget 6-18 months of your normal living costs, since a thorough search rarely wraps up in a few weeks.
Deal-sourcing and diligence costs. Even before you sign a letter of intent, you'll pay for things like data on prospective targets, travel to meet sellers, and possibly a part-time analyst or intern to help with outreach.
Professional fees on the deals that don't close. Expect to pay for preliminary due diligence (accountant reviews, basic legal review) on more than one deal that ultimately falls through. This is a sunk cost of searching, not a sign you did something wrong.
A rough starting number
Searchers self-funding a part-time or full-time search commonly budget somewhere in the low-to-mid five figures for the search phase alone, before any acquisition capital is involved, more if you're not drawing any other income during that time. Your actual number depends heavily on your local cost of living and how long your search runs.
The takeaway
Treat your search budget as a separate line item from your acquisition budget. Underfunding the search phase is what forces searchers into a rushed, worse deal just to stop the bleeding, not a lack of good businesses to buy.