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A founder’s guide to reference calls

References can be an important part of any decision-making process.

Whether you’re evaluating investors and non-execs, hiring for a new role, or fact-checking a potential co-founder, reference calls can provide comfort as well as test or reinforce your assessment.

However, as opposed to determining the outcome of your decision, founders should use reference calls for information first, confirmation second. This guide shares some tips and tricks on how to get the most out of them.

Key takeaways:

  • Prioritise insight into your future working relationship over confirming a decision that’s likely already been made.

  • Ask for ten references and pick three (a boss, a peer and a direct report).

  • Separate out the skills and tendencies you are looking to test/understand further.

  • Don’t be afraid to ask big, direct questions. It’s actually easier to respond to them.

  • Prevent defaulting to high-level information. Be prepared to read between the lines and drill down into specific, low-level commentary by requesting examples.

Before getting started

When requesting referees, ask for a list of ten to prevent gaming the system and pick three.

You should be looking for a full 360 degree view of the candidate to understand what they’re like in different situations. It should therefore include:

  • someone they’ve worked for (a boss)

  • someone they’ve worked with (a peer or team member)

  • someone they’ve managed (a direct report)

At the beginning of the call, provide comfort that all calls are confidential and that no details are shared with the candidate. Explain where you are in the process (signed terms, going through the final contract, moving to completion).

Guide them briefly through the process and why it helps to carry out these calls. You should state and re-state that (unless they turn out to be a serial killer), it is not going to affect the outcome of the decision. Ultimately it’s about how you can help them in their next journey of working within your company.

As their future colleague, you are looking for a candid picture of their strengths and weaknesses. Where are they a safe pair of hands? What areas are a watching brief and could benefit from real training and development?

To kick things off

The best way to kick off the conversation on the candidate is to put the ball immediately in their court. Start with a big open question like: what do you think of Candidate X? What has been your most lasting perception of him/ her?

This provides an opportunity to assess exactly how well they know the person they are providing a reference on. It also provides some cues that you can drill down into, which otherwise wouldn’t have cropped up.

Chances are the candidate will have discussed next steps with their referees. If it feels relevant (some referees can be very high profile), it’s worth getting some free insight into your own business, sharing a bit about it and then asking what they think.

You may be surprised at how reference calls can create connections that open up all sorts of possibilities. We’ve seen them spark entirely separate conversations around non-exec positions and partner companies or communities that can help drive the business forward.

Specific, big questions

The next part of the conversation should move towards asking some very specific, big questions to get them thinking. My favourite is: does this person have the capacity to build (or help to build) a massive business? Specifically, are they still going to be with us when we are running a £100m turnover company?

This next part should be testing your assessment (and the candidate’s own demonstration) of their skills and tendencies. Bear in mind, these are two very different things.

The easiest thing is to chat through hard skills. What are they like with numbers? How would you score them on “analytical rigour” on a scale of 1 to 10?

If it’s a sales role, you could ask what is their capacity for closing deals? How quickly do they make progress on the commercial aspects of the sale?

If they are going to be managing a large chunk of the team, focus on leadership qualities and ask for specific examples of how they have driven the previous business forward.

Tendencies are quite different. More than “soft skills”, these are really personality traits, which may be hard for the referee to describe without feeling as though they are betraying the candidate in some way. Interestingly, you will often find the more senior references will understand exactly what you mean as well as the reasons for asking and be far more candid.

Questions here might be around their pace of work of initiative, are they able to get a lot of shit done, fast?! What’s their experience of the candidate knowing when they need help and their ability to be helped? What’s been their experience of taking on feedback and being open to new ideas?

On both fronts (skills and tendencies), you should be able to get a sense of what aspects are a watching brief for the candidate. Specifically, how could you help them with outside functional expertise (through coaching or potential training) or what to watch out for as you work closer together over the coming years.

Always, finish the conversation with a backstop, such as is there anything else that we should be aware of? Anything that we haven’t covered?

Useful tips/tricks:

  • Always focus questions on specific qualities. Are they hardworking? Are they detail-oriented? Are they an asshole? Good/bad managers? Are they able to get people on board and instill a sense of mission?

  • Be prepared to read between the lines and use follow up questions to dig in further such as… “How is Joe at managing people? Can you give an example of X? What actually happened in situation Y? What do you mean by Z?

  • Don’t be afraid to ask direct questions. They are actually easier to respond to

  • Prevent the conversation from defaulting to high-level information. It is important to always drill down into specific, low-level commentary.

Chris Corbishley

Investor

Chris previously founded growthsquared.io a data science consultancy on a mission to help e-commerce businesses apply advanced analytics to their data and/or operating model. Before that, he was Head of Analytics at Swoon Editions, a business championing the "zero stock, zero lead time” model in online furniture retail. Chris undertook a PhD in organisational economics at Imperial College London, focussing on how public and private organisations structure themselves to deliver affordable energy services to the poorest parts of India and East Africa.

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