How to Run Founder and Expert Reference Calls in Venture Diligence

A reference call helps an investor test a specific claim about a founder, market or company. Preparation begins with a hypothesis that matters to the investment decision. The conversation should produce attributable observations and a follow-up question when evidence remains incomplete.

Decide what the call needs to establish

Suppose the investment thesis assumes that a founder can sell complex software into large organizations. A reference from a previous colleague may help test how the founder handled a demanding enterprise procurement process. A customer conversation can help test the company's current product value. These questions call for different reference sources.

Select references deliberately

Founder-provided references can offer detailed examples and are often favorably selected. With appropriate permissions, seek independent contacts able to discuss a specific role or decision. Record the relationship, time period and any reason the reference may have incomplete information.

A practical call script

Start by confirming the reference's familiarity with the subject and the period of observation. Ask for a description of a consequential decision the subject owned. Follow with what happened, how the team responded to setbacks and which evidence supports the reference's view. Ask where their experience is limited.

Example questions: What work did you directly observe? What was the most difficult decision you saw this person make? How did that decision affect customers or teammates? Where did execution fall short? Which context would change your assessment? Would you work with them again, and for what role? Adapt the script to the business and avoid seeking protected or irrelevant personal information.

Fictional worked example

In an illustrative diligence process for Beacon Systems, a previous implementation colleague says the founder missed an initial delivery estimate but later introduced weekly risk reviews and improved handoffs. The note records the reference's project, date and direct involvement. The analyst concludes that there is evidence of learning after failure, while repeatability across a larger team remains unverified.

Evidence register row: Claim: Founder can manage enterprise rollouts. Source: former implementation manager, interview October 9, illustrative. Observation: revised deployment approach after a missed deadline. Limitation: one customer project. Reviewer: investment associate. Next step: request another project reference. Decision consequence: open execution risk for investment memo.

Separate the reference's words from the investment conclusion

A respondent's view is one source, with a time period and perspective. The investor should preserve the precise context and consider whether other evidence corroborates it. For material contradiction, assign an owner to verify the issue before an investment committee relies on the conclusion.

Respect confidentiality and relationship boundaries

Do not circulate private comments beyond those authorized to review them. Obtain permission for outreach when required and follow applicable local law and the firm's reference-check policy. Domain expert research should not request another firm's confidential plans or trade secrets.

Turn findings into an accountable next step

A reference note should leave an answer, a remaining question or an explicitly accepted uncertainty. Founder assessment provides a wider context for the findings. The VC diligence checklist helps route specialist issues to the appropriate reviewer.

Treto's Diligence workspace can keep interviews and sources connected to the deal, while Relationships maintains relevant contact context within permissions. Reference selection, outreach and investment conclusions stay with the fund.

Questions investors ask

Can a reference call prove that a founder will succeed?

It can provide evidence about observed behavior in a particular context. The observer's relationship and the time elapsed affect its relevance. A reference cannot establish future outcomes, so the investor should test important claims against other sources and current operating results.

How should reference-call disagreements be recorded?

Record both observations with their sources and dates, then identify which differing assumptions matter to the investment case. Assign additional verification when possible. The decision record should show whether the committee resolved the disagreement, accepted the risk or deferred approval.