10 Questions That Reveal an Investor's True Colors
Red flags, green lights, and what previous portfolio companies reveal about investor behavior.
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Now for this week’s piece,
You should always do reference checks when bringing people, especially investors, on the cap table. They will be there for years, possibly decades, as part of the company. They don’t have vesting schedules like everyone else. Their behavior and reputation will become linked with your company.
You should do the reference checks when an investor confirms their interest to invest. Be upfront about this. Just as investors will check your background, you should do the same.
If I would be a founder, raising a round from investors, here's how I would conduct reference checks on these investors.
Preparation
I would find at least three previous founders, who've raised from this investor, and get them to have a 30 minute call with me. I would go to lengths to pick people who raised from the investor who've had different outcomes. One that went belly-up, one that is still going but is not a rocket ship, and preferably one that is going really well or has exited. This way, you can get a read on how the investor behaves when their portfolio company has been at different stages of the ups-and-downs of startup life. Things like, "How did they react when you had problems?" will give you a lot of insights into the investor.
Schedule these meetings as video calls, so that you can easily record the call and take notes. There's no need to share the questions beforehand, as it will give the founder too much time for preparation and often soften their response, when you want transparency and honesty.
I would ask a ten questions, or at least the ones that fit best to what you want to dig into. Here, I will share my top 10 questions. These questions attempt to discover behaviors that only founders would spot, and many of them are meant to understand how they work with founders in stressful moments.
The ten questions
1. Can you tell me how you met the investor, how was the negotiation phase before the investment, and how long were they involved with your company?
Understanding how an investor met the founder reveals their sourcing strategy and expertise. Were they actively scouting or relying on warm intros? I’ve noticed that investors who pursue outbound deals often show stronger long-term commitment than those relying on inbound flow.
Questioning the negotiation phase will show the investor’s operating style. You'll learn important aspects about their character:
whether they're straightforward or try to renegotiate settled terms,
if they move quickly or drag out the process,
whether they're reasonable with their demands and
transparent about their concerns, and most importantly, how they handle disagreements during tense moments.
An investor’s involvement length reveals their long-term commitment. If they’re still engaged, it shows lasting support. If they exited, it helps assess their behavior across company phases. The timeline also indicates whether they stayed active or withdrew post-investment, adding context to their feedback’s relevance.
2. How accessible are they? Do they respond quickly when you need them? (For bigger VC firms) Did you get to spend time with the people you wanted at the firm?
This question reveals how investors engage with portfolio companies beyond the courting phase. Their accessibility and responsiveness indicate what working with them will truly be like. In larger VC firms, access to key team members matters. Partners and specialists may seem engaged during pitching and the early stages, but post-investment reality can be very different.
Response time matters—urgent hires, pivots, or crises often need quick investor input. Knowing how fast a VC responds shows if they’ll be reliable in critical moments. Some investors are surprisingly slow or hard to reach when it counts.
Continuing from my outbound versus inbound comment earlier, the investor's accessibility style can reflect on how they view their role. Some investors maintain close contact because they want to be genuine partners in building the business. But others might be more hands-off because they trust founders to operate independently. Neither approach is in itself wrong, but you need to know which style matches your needs and expectations.
3. What specific ways have they helped your company grow? Do they help with introductions, hiring, strategy?
This question is meant to uncover the true nature of the investor’s approach to helping companies. Often, early-stage investors who add genuine value can dramatically accelerate a company's trajectory.
When you ask about specific contributions, you're looking for concrete examples rather than vague claims. Did they actually open doors? Did they help during strategy inflection points? The specificity reveals whether they're hands-on partners or simply capital providers.
This question also exposes their working style. Are they assertive and directive? Are they proactively identifying opportunities? Do they respect founder autonomy while still offering substantive support?
The introduction aspect is particularly telling. Making valuable introductions for portfolio companies is often the most impactful way VCs can help at the pre-seed stage. If an investor hasn't been connecting their founders to customers, talent, or follow-on capital, that's a red flag worth exploring further.
Ultimately, this question helps you distinguish between investors who view themselves as true company builders versus those who see themselves primarily as financial backers.
4. How strong is their network, and do they actively leverage it for portfolio companies?
This question helps you evaluate one of the most important aspects of VC value beyond just capital - their network leverage capabilities.
When you ask previous founders about the investor's network strength and how actively they utilize it, you're uncovering whether the VC's claims about "opening doors" actually materializes or not. Many investors say impressive things about their networks during pitch meetings, but a reality check is needed.
The quality of introductions matters tremendously. Some investors make thoughtful, warm introductions with proper context that lead to productive relationships, while others might simply share contact information or make superficial connections that go nowhere. Former portfolio companies can tell you which category this investor falls into.
For pre-seed companies especially, these network effects can dramatically impact your trajectory. Understanding exactly how the investor has helped other companies with similar needs gives you realistic expectations about what value they'll bring beyond their check.
5. "How did they behave in subsequent funding rounds? Did they follow on or help attract other investors?"
A strong investor becomes an invaluable fundraising ally when you're ready for your next round. They should proactively leverage their network to connect you with appropriate later-stage investors.
An investor’s support speaks volumes. Do they champion you to others, refine your pitch, and share why they invested? Their endorsement can shape how new investors perceive your company.
Even without contributing additional capital themselves, valuable investors prepare you for future fundraising by helping strengthen your narrative, advising on timing, and providing guidance on deal terms. They understand the evolving funding landscape and help position your company advantageously within it.
6. "How do they react to bad news, or to situations like when the company pivoted or missed a target?"
Former portfolio founders can tell you whether the investor maintains composure and provides constructive guidance during crises or if they become punitive and add pressure. Some investors present themselves as founder-friendly during good times but transform into demanding critics when targets are missed or when market conditions change unexpectedly.
Their reaction to pivots is especially telling. Strong investors understand that early assumptions often require adjustment and will support thoughtful changes in direction with additional resources and connections. Others may resist necessary pivots, creating friction when you need flexibility most.
The best investors distinguish between temporary setbacks and fundamental problems, remaining steady during the former while helping address the latter. They bring perspective from other portfolio companies, suggesting practical solutions rather than just highlighting problems.
7. "What's the biggest disappointment or challenge you've had working with them?"
Former founders are typically hesitant to speak negatively about their investors, so framing the question around "disappointments" or "challenges" creates space for honest feedback without requiring outright criticism. Their answer often reveals the investor's blind spots, communication issues, or areas where they overpromised and underdelivered.
Pay close attention to patterns across multiple references. If several founders mention the same issue, it likely is a consistent issue rather than a one-off situation. Common themes I’ve seen:
responsiveness problems
micromanagement tendencies
conflict avoidance
misalignment between stated and actual investment priorities
The nature of the disappointment also matters. There's a significant difference between frustrations about limited network access versus ethical concerns or trustworthiness issues. Some challenges can be managed with clear expectations, while others might be dealbreakers.
8. "Would you take money from them again?"
This question is simple but powerful. It distills a founder’s entire experience with an investor into a single judgment call. The directness of the question can elicit an immediate, visceral response before the founder has time to filter their answer. Their initial reaction - whether enthusiasm, hesitation, or reluctance - tells you more than their detailed explanations might :)
Pay attention not just to the yes or no, but to the qualifications that follow. A founder might say "Yes, but only if..." or "No, unless..." which can reveal specific circumstances where the investor shines or struggles. These conditions often highlight the investor's particular strengths and weaknesses that might be relevant to your situation. Don’t forget to query for a “why?”
The answer gives you insight into the long-term relationship quality, which is critical since you'll potentially be working with this investor for 5-10 years. A founder who would enthusiastically take money again is telling you that despite inevitable bumps, the investor was ultimately worth the partnership.
9. "What type of founder or company would be a good fit for this VC?"
This question reveals the investor's true strengths, preferences, and operating style beyond their public marketing. Every VC has specific types of founders and companies they work best with, regardless of what their website claims.
The founders can tell you if the VC excels with technical teams needing business guidance or vice versa. Do they offer hands-on mentoring for first-time founders? Minimal involvement with seasoned ones?
The answer often exposes unspoken biases—do they work best with confrontational or collaborative founders, technical builders or aggressive growth-hackers?
It also uncovers their true sector fit. Some VCs thrive in SaaS, or consumer, but struggle with hardware, despite claiming sector-agnosticism. Knowing whether you’re in their sweet spot or an outlier helps gauge the support you’ll receive.
10. "Do they try to control decisions, or do they act as a true partner?"
Former founders can tell you if the investor respects founder autonomy while still providing valuable input, or if they attempt to override decisions when views differ. Some investors present themselves as hands-off partners but become surprisingly controlling when business challenges arise or when the company moves in directions they didn't anticipate.
Pay attention to specific examples of how the investor handled pivotal moments. Did they support founder-led decisions even when they initially disagreed? Did they offer perspective but ultimately defer to the team's expertise? Or did they use formal or informal pressure to redirect the company's path?
The answer also reveals their communication style during strategic discussions. Effective investor-partners express concerns constructively, ask probing questions, and help strengthen ideas rather than simply shutting them down. They understand the difference between governance oversight and operational management.
Final words
Here's a few more items to consider when doing these reference check calls:
Respect the founder's time but go deep. Start with your most important questions, but be prepared to explore revealing threads that emerge during the conversation.
Look for patterns across multiple references. One negative experience might be an anomaly, but consistent feedback across several founders likely reveals a pattern.
Be transparent about your concerns. If you have specific worries about the investor, share them with references to get their perspective.
Consider fit specifically for your situation. The investor might be great for some founders but not a match for your communication style or decision-making approach.
Take notes during calls rather than trusting your memory. Better yet, get an AI notetaker to join the call and record the conversation for the best notes.
Remember that all investor-founder relationships involve some challenges. Focus on identifying red flags that would be problematic for your specific company and working style.
Excellent post. Doing this work signals to the investor that you are thoughtful and long term.