Fundraising
Reference Check
Conversations with former colleagues, investors, and customers of a founder to verify their character, skills, and track record before investing.
Reference checking is a critical part of VC due diligence — particularly for early-stage investments where founder quality is the primary investment variable. Good reference checks go beyond the references a founder provides (who will obviously say positive things). Top VCs do 'back-channel' reference checks: calling people who worked with the founder but weren't provided as references. Common questions: How does this person handle pressure? Do they listen to feedback? Are they honest about bad news? Do they build great teams around them? Reference check subjects: former colleagues, employees who worked for the founder, previous investors, customers who've dealt with them, and co-founders from past ventures. Reference checks have stopped many investments that looked good on paper.