Austin Stofer graduated college two years ago, but he’s already the founder and CEO of two different companies consulting future startups and providing a wealth of knowledge worth two lifetimes. Even as an eight-year-old, Stofer was a businessman. His first venture started with a snow cone machine he purchased with birthday money and hauled around his neighborhood in a wagon. The sales of his icy treats expanded as he began to book “gigs” providing snow cones at various parties and events.
Founding the Startup of Startups
Following his dream of starting his own business, in college Stofer established his first successful venture, Siëo. Prior, he pursued several different projects that didn’t pan out, but learning from his mistakes were an important foundation. The company concept was born when the Chapman University undergraduate not only took an interest in startups but their mistakes and failures.
“There’s a couple common denominators amongst all companies that we’ve identified that every single company’s going to have to go through,” Stofer explained.
The company provides a variety of services to prospective startups looking to get their businesses off the ground. From marketing and design to business development and technology, the company’s number one goal is to help businesses succeed.
“Siëo is a modular dashboard with all the different tools an entrepreneur would need. You can come to us, you can validate your ideas through us, you can check your competition, you can build your team. Now once you start legitimizing your company a little bit more, you can incorporate through us.” he explained. “We’ll help you learn from our mistakes so you don’t have to make the same mistakes we did.”
Turning Challenge into Opportunity
The capital to fund a startup doesn’t appear out of thin air, especially when your CEO’s a college student. Unfortunately, Stofer and his Siëo team began to discover how flawed the venture capital ecosystem was. Channeling his entrepreneurial spirit, Stofer transformed a bad experience into a positive business opportunity establishing RateMyInvestor.
Stofer’s partner in crime Bennett Quintard, Siëo and RateMyInvestor co-founder and COO, shares the hurdles faced in building a relationship with an investor. He describes a blind trust that exists for the entrepreneur.
“Founders face a significant lack of transparency into the funding process and rarely have enough information to know whether the investors they are speaking to would be good business partners,” he explained. “Trust is everything, and just because someone wants to put money into your company doesn’t mean it is a good idea to take it.”
Siëo learned the hard way how costly this one-way mirror in the process could be. Working with an investment firm to their secure funding, the team spent months working to meet their expectations only to be met with more and more empty promises. After serious time and money were spent along with numerous calls with the firm, the communication disappeared without explanation. Siëo discovered later on they weren’t the only startup to be “ghosted” by this particular investor.
“That spurred the question of why we had no way of learning more about investors we were speaking to and why we couldn’t do much to warn the next team that would fall prey to their time, cash and energy exhaustive process,” Quintard said.
The mission of RateMyInvestor is to balance the transparency between entrepreneurs and investors. The free online platform allows founders to review their experiences with venture capitalists, which creates a database of research for others looking for the right investor. Each review is vetted by Stofer and his team.
“We have to hold these reviews to very high standards and vet them very carefully,” Stofer said. “This is not a revenge platform, but a place where founders and funders can come together to break down the fundraising barrier.”
According to Stofer, there’s a mutual relationship that exists between funders and founders and the RateMyInvestor platform is a place where both can build these connections. The site, however, serves a deeper purpose than a meeting spot. The fundraising process is an intense one for both sides.
With RateMyInvestor, both parties can access valuable information that will save time on both ends adding more valuable data to the decision of whether or not each deal is a good fit. The platform also partners with Diversity VC, a non-profit promoting diversity in the venture capital industry, to provide in-depth reporting on U.S. venture-backed startup diversity.
Stofer’s Advice for Startups
With two startups of his own and being in the business of helping small business, Stofer has quite a bit of advice to offer that’s meaningful, because it comes from personal experience. For other startups to find their perfect investor, he agrees due diligence is important. HIs other advice includes knowing what you want and setting expectations from the start, making sure the perspective investor aligns with the startup’s vision, mission and beliefs.
When it comes to making connections, Stofer explains cold emails just won’t do. Founders must have an aptitude for networking and face-to-face relationships. RateMy Investor learned firsthand about this experience negotiating the acquisition of the company KnowYourVC to help advance their platform. This company already had the network, leadership and early reviews to save RateMy Investor valuable time and money. Quintard explains the impactful lesson the company learned.
“What people respond best to are not always numbers and spreadsheets. People want to work with others who are passionate about what they do,” he said. “Vision is everything and even though KnowYourVC was looking at other offers for more cash, the decision to go with RateMyInvestor’s offer came from the relationship and vision we shared with their founder.”
Relationships aren’t just the foundation of successful negotiating, according to Stofer, they’re essential to pitch like an expert.
“Relationships increase the likelihood your pitch will be read and understood” he explained. “That’s the difference between sending 50 cold emails and sending five highly targeted, specific emails that actually get you a meeting.”
Stofer believes there’s an art to pitching, and building that relationship is like a primed canvas an entrepreneur is ready paint on. His other pitching advice includes getting to know the investor, customizing every pitch and getting specific with the ending. For example, instead of ending with “let’s chat sometime,” ask to meet the investor on a specific time and date for coffee.
If there’s anything Stofer wants startups to take away from his experience, it’s not to make decisions blind in search of a venture capitalist. Especially with RateMyInvestor, entrepreneurs have an additional resource to help them with the process.
“The right investor can make the difference between sinking your ship and a future IPO,” Stofer said.
-Gabrielle Kuholski Shaw
Austin Stofer has entrepreneurship in his blood. Being born into a family of business creators, he found the drive to start his own business at a young age. A few days after his 8th birthday, Austin invested his birthday money into a snow cone machine and began hauling a wagon around his neighborhood selling snow cones. After cornering the snow cone market, Austin took on launching businesses in marketing, corporate branding, and application development. Now, as a Chapman University graduate, Austin is passing his startup knowledge onto other entrepreneurs. Sieo provides a range of services, including marketing, design, business development, and technological consulting. It simplifies, organizes and helps to legitimize ideas. Austin’s goal with Sieo is to help people take their dreams and make them professional realities.
