Why team matters more here than anywhere else in finance
At pre-seed and seed, there's often no product, no revenue, and no market data worth trusting yet, so the team is most of the evaluation. Even at later stages, a VC is buying a minority stake and cannot force decisions the way a PE firm installing new management can (Lesson 19 covers this directly), so backing people who will make good decisions without you in the room is not optional, it's the whole job.
| Dimension | What it looks like | How it's checked |
|---|---|---|
| Domain expertise | Deep, specific knowledge of the problem, not just enthusiasm for it | Ask a question only an insider could answer well |
| Prior execution | Has shipped something before, doesn't need to be a prior exit | References from former colleagues, not just from the founder's own picks |
| Coachability | Updates their plan when shown real evidence, doesn't just defend the original idea | Watch how they respond to a specific, pointed challenge in the room |
| Team completeness | The founding team covers the skills the business actually needs (build, sell, operate) | Map each co-founder's role against what the first 18 months require |
Reference calls are not optional
A founder's own chosen references will, unsurprisingly, say positive things. The useful signal comes from back-channel references, people who worked with the founder but weren't offered up as a reference, reached through a fund's own network. A back-channel call that surfaces "brilliant but burns out every team within a year" changes a screening decision in a way a front-channel call never will.
The product will change five times before Series A. The team, mostly, will not.
Checkpoint
- Domain expertise: specific, checkable knowledge, not just enthusiasm.
- Prior execution: evidence of having shipped something before.
- Coachability: updates the plan in response to real evidence.
- Back-channel references: the references a founder didn't hand-pick are the ones worth the most.
If anything here still feels unclear, ask before moving to Lesson 8.