Before you sign with a new investor, call three founders whose companies did well with that partner and three whose companies struggled or failed. Ask how the partner behaved when the numbers were bad, not just when things were going well. A good pitch tells you little about how someone acts under pressure.
Why check references on your own investors?
Because the relationship outlasts the term sheet by years, and you are choosing it with far less information than they have on you. Venture firm CRV argues your negotiating power runs in your favor only briefly: the best moment to check a partner's background is while the term sheet is still live, since founders who accept an offer before doing that diligence tend to end up with more dilution and worse terms later, according to its guide on vetting investors. Once you sign, that window closes.
Who should you actually call?
Not just the names the partner hands you. Ask for two groups:
- Founders from companies that did well. This shows you how the partner behaves at their best.
- Founders from companies that struggled or failed. This shows you how the partner behaves at their worst, which is the version you are more likely to need.
A VC's own shortlist will lean positive by design, so look past it where you can. A second-degree connection, someone who knows a founder who worked with the partner, often gives a more candid read than a reference the partner chose themselves.
What should you actually ask them?
Skip the questions a reference expects and go to the ones that are harder to spin.
| Area | What to ask |
|---|---|
| Crisis behavior | How did the partner act when metrics dropped or a bridge round came up? |
| Board dynamics | What happened when a board meeting got tense? |
| Follow-on support | Did the fund back the company through more than one round? |
| Day-to-day reality | Who do you actually work with after the deal closes? |
| Control | Does the partner push specific hires or vendors on the team? |
CRV's own founder-facing guidance treats crisis behavior as the single most revealing category, since it strips away the version of a partner you meet during the pitch and shows the version you get once things get hard. TechCrunch's list for early-stage founders makes a related point: the questions worth asking an investor directly, not just their references, should test how they actually add value beyond the check, per its list of questions founders should ask investors.
What counts as a red flag?
A partner who was easy to reach before the wire landed and harder to reach after. Also watch how a VC reacts to being asked for a reference from a company that went badly: a partner who gets defensive or stalls on that request is telling you something true about how they handle scrutiny generally.
Write down what each reference tells you, in their words, right after the call. A pattern across three calls is worth acting on; one offhand comment is not, and the two are easy to confuse a week later when you are deciding whether to sign.
This same discipline matters inside your own team, not just toward outside investors. How investors evaluate a founding team covers what the diligence looks like from the other side of the table, and founding team due diligence walks through the cofounder-relationship questions a serious investor will ask before they commit. If your own reference-check instincts could use a dry run first, a free cofounder alignment check is a useful place to see where you and your cofounder already read a situation the same way, and where you do not.
Frequently asked questions
- When should founders run reference checks on investors?
- While the term sheet is still live, before you sign. That is the only point where you still have real negotiating power. Founders who accept an offer first and check references afterward usually find they have little room left to act on anything they learn.
- Who should I call for a reference on a VC?
- Ask the partner for contacts at companies that did well and companies that struggled or failed, three of each if you can get them. The VC's own shortlist will skew positive, so also look for a second-degree connection outside that list who has actually worked with the partner.
- What questions reveal the most about a VC partner?
- How they behaved in a bad stretch: when the metrics dropped, when a bridge round was needed, or when the board got tense. Founders consistently say this is where a partner's real character shows, far more than how warm they were during the pitch process.
- What is a red flag during an investor reference check?
- A partner who was engaged and responsive before the money closed, then hard to reach afterward. Also watch for a VC who reacts badly to being asked for a reference from a company that struggled. How they handle that request is itself useful information.