When it comes to working with investors, Stoney Stanfill, a veteran CEO and co-founder, values a key principle: partnership. In his 30-year career, he’s seen firsthand what makes an investor stand out from their peers. It’s not just about capital — it’s about finding someone who has complementary skills, can fill critical gaps, and is truly invested in the business. He emphasizes, “How many firms could write a meaningful check? ...Plenty. What is [the investor’s] connection with that person, or that group, and that whole organization?”
Stoney highlights his experience working in two different environments — from growing a company over 20 years to stepping into the CEO position at a bootstrapped company. The transition opened Stoney’s eyes to the challenges of scaling, noting that the depth of talent and the rate he could grow his teams were drastically different. In bootstrapped businesses, speed matters, but having access to the right network to bring in experienced people can be a game-changer.
He shares a memorable piece of advice: the airport test. He explains, “Would I be okay hanging out with this person at the airport if I have a three-hour [flight] delay? That's the first thing. Make sure you deal with somebody you like for good businesses,” emphasizing the importance of mutual trust, genuine rapport, and transparency.
Stoney goes on to reveal that one of the biggest mistakes investors make is “faking it,” urging investors to simply admit when they don’t know something. “We can go find out whatever we don't know. But if you’re just making stuff up, what's going to happen in the future?” His perspective provides helpful insight into the investor-founder relationship and offers a reminder that human connection is essential. Hear more from Stoney by watching the video below.
Transcription:
Sourcescrub: Tell us a bit about your background and experience working with investors.
John “Stoney” Stanfill (JSS): My background has been information services. I've been by my whole career in information services for 30 years at this point. 20 years spent at a big, now publicly-traded commercial real estate information company that is closing in on global in its coverage. After 20 years there, I went to an information service business that was received an investment from a private equity company.
That private equity company asked me to come and be the CEO as the founder was rolling out as part of that transaction. And then since then, I've been doing a bunch of different information service kind of board work. I've started another business, information business, etc. and so that's kind of my background, but always very narrowly focused on the information service world.
The things that were compelling to me, the investor that made the investment into that, the business sales and marketing information business, was that I, I really wanted to have a partner that would be my partner, and that was the essence of it. You know, I was I wanted to enjoy working with them. They could fill the gaps on where my gaps were.
So we kind of yin and yang had like a very complementary relationship, somebody that was responsive and that was available to be a resource for me. With 20 years of the commercial real estate information company was it grew really, really fast, and we were always climbing up the hill. There was never a chance to look back and reflect back on what we had learned.
And then as I went to this next endeavor, it was like, okay, now I can look back on everything I learned over the past 20 years to put into practice on this business and then leverage my the sponsor, the partner as my partner in crime to actually get stuff done, you know, and really be able to work in, in harmony with them.
And I needed to like them. I needed to like, respect them. And, you know, in that case, saying all those things were very true. They were great partners.
Sourcescrub: What were some notable differences between running a young vs. a mature company?
JSS: It was also the first time I was CEO. I mean, I'd held senior as an executive officer. The other business, I ran big groups of people and all that kind of stuff. But it was the first time that I was, you know, all on my shoulders as the CEO. And so just having that person that I trusted was really I was I was the outsider.
I was the guy who came from another business. And, you know, it wasn't homegrown like the rest of my fellow workers. So I wasn't the enemy by any means. But I was just like, right. You're thinking that should be done this way. We don't think so. And I was like, I think so. But then I had my partners and my sponsor there, the private equity guys.
I'm like, hey guys, I'm thinking this way. I'm getting the vibe that this is not what these guys are thinking. The 20-year company was, you know, 2 million to 600 million. And so I went through all that and like, during all that time, I was, you know, we're building the team the whole entire time, you know. So when I started there, it was maybe 30 employees.
And then there was by 3000 or so when I left. So you accumulate and refine your team, like ongoing through that whole process. Then when I went to this other company, it was, you know, maybe 100 people and it was a little bit more bootstrapped, very successful business, bootstrapped, but having to build out the organization. And by the time I left the other business, we had really good people all around us.
We had highly capable people. And it's not to say that the people the next business weren't capable, but, you know, the people that I left my teammates at the other place were able to run a multi hundred million dollar publicly traded business, right? And then you go back into a smaller growing up business and you realize there's excellent people there.
But boy, if we had some more people with more experience that would make things go faster. And most of my network was still highly embedded in my old job. So I and I swore I was not going to go pull from my previous employer either. I thought it was just like a thing of allegiance for me. And so like having a network of people that could help me build out my team was really, really important at the next gig and build it out faster.
Once you get on the phone, then it's like the airport test, you know, like, could I hang out if I have a flight delay, three-hour delay? Would I be okay hanging out with this person at the airport? Or would it just be hell? And like if they pass the airport test, you know, then that's the first thing before you even get to, you know, because if you have a successful business, keep running a successful business.
And then if you want to go do something with that successful business, make sure you deal with somebody you like for good businesses; there's probably plenty of capital. It's whose guy that or a person that you jive with the best.
Sourcescrub: Where do you see PE firms drop the ball?
JSS: Trying to fake it, fake it to the point of it. I would much prefer if someone says, I don't know, then make up some kind of thing. Because if you're, you know, if you're really thinking about, I don't know if I have a ton of first-hand experiences. It's just more of my own personal philosophy, but like, I'm totally okay with if someone says, I don't know. Great. Big whoop.
Yeah, no, congratulations. Like, we can go find out whatever we don't know. But if you tell me, like, if you're like, just like making stuff up, okay, if you're making stuff up on this, like what's going to happen in the future and so it just doesn't seem like a good, viable partnership, you know, like, I'd much rather just full transparency, honesty and transparency.
Those are the two things. It's cliche, certainly, but there's a lot of people that tell you exactly what you want to hear and make it sound all perfect. And peaches and cream, which, if you it may or may not be. Like I will always tell sales teams like if you don't know, say, I don't know. And you know what happens if you can come back?
If you say, I don't know, but I can find out the answer for you. Like, that's better rapport building than sometimes knowing it off the top of your head. If you like go take what could be slightly embarrassing that you don't know what maybe should be basic. Maybe it's not, I don't know, but like, yeah, the bad it's not bad to not know.
I don't think and say I need to figure it out.
Sourcescrub: What are some key signals that indicate deal readiness?
JSS: The founder that I took over for put it up for sale. Hired a banker, put it up for sale. He had a goal of a revenue goal. He had a goal of an exit price goal, you know. And he felt like he was there. And that's what I mean. Very plain and simple. This was his third exit, and I was just like, that's just what it is.
Going on to his fourth. You know, like that was just what he did and very successful. Like he had been like from a like a financial perspective. She was kind of all set after the first deal. And then he had a couple or so. It wasn't. It was a just the fives and tens that was motivating them. I was, you know, he kind of ran its course with them.
The next guy selling that business would be, you know, it was I think there was just two businesses that were competing head to head that were really competing head to head to the detriment of the bigger opportunity. And it was very apparent that if you marry the two businesses and put them together, everything gets better. You know, that's the financial metrics.
The data gets better, the software gets better. You know, because it's like just, it's a better outcome. When these two companies were very, very similar, doing very similar things. And so, by marrying them together, there was surely an elimination of a lot of redundant costs. Like, you know, I need one HR department, like that type of thing. So that's super obvious.
And then the cham was huge. So more good salespeople was good. And, the data set, when we would both get into the boxing ring, I mean, every day was like, we get into the ring and would be like, okay, $1 less than what the other guy just said all the way down. Let's just like at some point it's not good for the business.
It's not good for the industry, frankly, because just like we have a lot of opportunity out there.
Sourcescrub: How can potential partners build meaningful connects with founders?
JSS: Everyone's got “what’s your why” that whole thing. Like my “why” would be different than yours or a 25-year-old person's or a 70-year-old person. It is super subjective to that founder, you know or to that potential seller. How many billion dollar plus funds are there out there? Or how many $500 million plus funds are out there?
Like how many people could write a meaningful check? How many firms could write a meaningful check? A gazillion. Or not a gazillion, but plenty. So what is your connection with that person, you know? And, or that group and that whole organization and feel like those are the pieces of the puzzle that are going to be very subjective and expertise is one or like likability, the EQ component is high.
The IQ component is high, the resources that person can bring. If those are the resources you think you need. Creative with new directions to take your business that you think you know, or if they've got other companies in their, you know, portfolio that could be married together or who knows what.
