# The Pre-IC Deal Readiness Standard: Verified, Conditional, or Not Ready

*You can grade any sourced deal as Verified, Conditional, or Not Ready for the partner vote using a claim-by-claim rubric two partners would score identically.*

- Canonical URL: https://www.refolk.ai/guides/pre-ic-deal-readiness-standard
- Pillar: Investing and deal sourcing
- Format: Standard
- Published: 2026-09-23
- Last reviewed: 2026-09-23
- Reading time: 15 min

Deciding whether a sourced deal is ready for the partner vote is a grading problem, not a document-collection problem. This standard is for early-stage investors, platform and talent partners, and angels who need to say, out loud and defensibly, whether a diligence packet is done. It turns "does this feel ready?" into one of three grades - Verified, Conditional, or Not Ready - scored claim by claim so two partners reading the same packet would land on the same verdict.

Most diligence checklists online are request lists aimed at founders assembling a data room. This is the other side of the table: the rubric the investor uses to decide if what came back is enough to bring to a vote. It spans team, company, market, and traction claims in one gradeable pass, and it insists that each decisive claim be tied to a named public or primary source with a stated shelf life.

## What the three grades mean

A deal is **Verified** when every load-bearing claim is tied to a named primary or public source, reference calls are complete including off-list voices, and the chain of IP title is clean. **Conditional** means the thesis is intact but one or more decisive claims still rest on founder-supplied evidence or unfinished checks, and the memo names each condition. **Not Ready** means a load-bearing claim is unverifiable, a screen surfaced a red flag, or the packet has not cleared basic team and IP review.

The grade attaches to the packet, not to your enthusiasm. Hustle Fund's method is claim-first: write down the three to five claims that must be true for the investment to work, rank each by impact and uncertainty, and those claims become your diligence plan. The grade is simply the worst grade any load-bearing claim earns. One un-corroborated decisive claim caps the whole deal at Conditional, however strong the rest.

> **Rule:** The grade is the floor, not the average
>
> A deal is Verified only if every load-bearing claim is Verified. One decisive claim resting on a founder screenshot or a warm intro caps the entire packet at Conditional, no matter how complete the rest of the room is.

The point of three grades rather than a yes/no is that Conditional is a legitimate, common outcome. In competitive rounds investors deliberately shift diligence to the post-term-sheet window, which means the packet at IC is structurally thinner by design. Grading that packet Verified would be dishonest; grading it Not Ready would lose the deal. Conditional with named conditions is the correct answer, and the confirmatory window is where those conditions get cleared.

## Which claims are load-bearing, and by stage

Load-bearing claims are the three to five statements that must be true for the investment to work, and they cluster into five categories: team, market, product and traction, business model, and ownership and legal. What you weight shifts sharply with stage. At pre-seed, weight founders, problem insight, customer discovery, prototype, use of funds, and ownership basics. At seed, add retention, unit economics, go-to-market repeatability, hiring, security, contracts, and a fuller financial review.

Kruze frames the effort itself as stage-scaled: the amount of effort put into diligence increases dramatically depending on stage, because pre-seed and seed companies do not have reams of historical financial data, whereas Series B and beyond require deep examination. So the rubric does not grade every category with equal severity at every stage. It grades the claims you flagged as load-bearing, and at pre-seed those lean toward team and problem insight rather than a financial audit.

The discipline is to name the claims before you touch the data room. If you cannot state, in one sentence each, the three to five things that must be true, you have not framed the deal - you have a folder of documents. A well-framed claim reads like "the two named founders built the core product themselves and own the IP," not "the team is strong."

**31% - Early-stage VCs who do not forecast financials**

At pre-seed and seed, projections are often not the load-bearing claim, which is why the rubric weights team and traction more heavily.

## How to verify each claim, and what it looks like when it lies

Every load-bearing claim needs a source, and the source has to be one that cannot be faked as easily as the claim. The rule is simple: founder-supplied evidence supports a Conditional grade; independent primary or public evidence supports Verified. A revenue figure spoken in a meeting is a claim. The Stripe dashboard behind it is evidence. Hustle Fund is blunt about the gap: for revenue claims, ask to see the Stripe dashboard or bank statements, and if the founder hesitates, that is a red flag.

The table below pairs the most common load-bearing claims with the source that verifies them and the false positive that source is designed to catch.

| Claim | Source that verifies it | What it looks like when it lies |
|---|---|---|
| Revenue and traction | Stripe or bank statements | A screenshot of a metrics dashboard with fabricated numbers |
| Signed partnership or contract | The executed PDF you can read | Verbal or "in progress," which does not count |
| Founder credential | Employer HR dates, not the profile | "Worked at Google" meaning a three-month contract |
| Customer love | A customer you picked from the full list | Three coached, founder-chosen happy calls |
| IP ownership | Assignment agreement per contributor | An MVP built pre-incorporation or by an unassigned contractor |

Read that "when it lies" column as the heart of the standard. Every criterion has a failure signature, and a grader who does not know the signature will pass a coached deal. "Our CTO worked at Google" can mean a contractor for three months; the check is employer dates, not the LinkedIn self-description. A signed partnership that turns out to be verbal is not a partnership; the check is the executed PDF. If everything is verbal or in progress, it does not count toward Verified.

> **Watch out:** A screenshot is a claim, not evidence
>
> Fake revenue numbers in a metrics dashboard are the easiest thing to fabricate in a data room. Grade revenue Verified only against a Stripe dashboard or bank statement you saw yourself, never a pasted image.

## The reference-call bar for a Verified traction grade

Traction is not Verified until at least one paying customer you selected from the founder's full list confirms it. Founder-chosen references are the classic false positive: three coached, happy calls that pass any rubric which only counts calls. The fix is procedural. Do not call the three the founder suggests; ask for the full customer list, then you pick who to call.

How many calls constitute "enough" depends on your firm, and named sources spread widely. The dossier's figures below are directly comparable counts, so adopt one as policy and write it into the rubric.

| Source | Calls expected | Includes backchannel? |
|---|---|---|
| CRV | 5 to 7 | Yes |
| Hustle Fund (minimum) | 3 customers + 2 investors | Yes |
| Top-tier (reported) | 15 to 25 | Yes |

CRV tells founders to aim for five to seven total conversations, including VC-provided references, backchannel references you find yourself, and if possible founders from companies that struggled or failed. Hustle Fund sets a floor: talk to at least three real customers who pay money and at least two investors not suggested by the founder. Top-tier firms are reported to run 10 to 20-plus reference calls per deal, targeting people the founder names and people the founder does not.

The number is not the point. The composition is. The decisive reference is the one the founder did not pick. Firms run 15 to 25 calls precisely to reach off-list people, so a Verified grade on traction requires at least one off-list customer and at least two off-list investors, regardless of your total count.

#### From claimed traction to a Verified grade

| Stage | Figure | Note |
| --- | --- | --- |
| Founder's full customer list | all | not just the three suggested |
| Customers you selected | subset | you choose, not the founder |
| Reached and confirming | fewer | paying, on the record |
| Off-list confirmations | minimum 1 customer + 2 investors | the Verified bar |

*Each stage narrows the pool until only independently sourced confirmations remain.*

Backchannel is where the market's geography starts to matter. In Refolk's index of professional profiles, US professionals holding Venture, Investment, or General Partner titles outnumber their UK counterparts by roughly 11.9 times. That makes lining up off-list co-investor references far easier on a US deal. On a UK deal, "talk to prior investors" is a scarcer, slower check, so budget more time and expect Conditional to sit longer.

I ran this search: `Angel investors and seed-stage partners in the US who previously backed Stripe` - [see the full result list](https://www.refolk.ai/s/zx1c198htr).

*Returns off-list investor references you can backchannel without going through the founder's introductions.*

Finding the customer references the founder did not hand-pick is the other half of that work, and it is exactly the "just ask" job [Refolk](/) is built for. Instead of accepting three warm intros, you can name the role and the market and get back the operators who would actually know.

## The step-by-step readiness procedure

The procedure runs from framing the claims to closing confirmatory diligence. It is written to fit the early-stage timebox: seed diligence before the term sheet runs 2 to 4 weeks, and the confirmatory window afterward is roughly 30 days. Steps 3 and 4 run in parallel.

#### Grading a sourced deal for the partner vote

1. **Frame the load-bearing claims** - Write the three to five claims that must be true, then rank each by impact and uncertainty. Done means a ranked claim list that becomes the diligence plan; about one day.
2. **Screen before deep work** - Spend five minutes on basic screening before hours of diligence: scan the cap table and Google every founder for red flags. Done means a go or no-go on cap table sanity and founder history.
3. **Verify team and traction against primary sources** - Pull Stripe or bank statements for revenue, executed PDFs for contracts, employer dates for credentials. Done means every load-bearing claim is tagged to a named source, not a screenshot; several days.
4. **Run reference calls on-list and backchannel** - Run your firm's call count including customers you selected from the full list and at least two investors the founder did not suggest. Done means the count is complete with off-list voices; one to two weeks, parallel with verification.
5. **Review legal, IP, and cap table** - Confirm an invention-assignment agreement for every founder, employee, and contractor, and re-check chain of title. Done means a clean chain with no unassigned pre-incorporation IP; days.
6. **Write the deal memo with an explicit verdict** - End with a clear recommendation - invest, pass, or conditional - and if conditional, spell out the conditions. Done means a memo carrying one of the three grades and its evidence.
7. **Circulate and vote** - Circulate the memo no more than 24 hours before the IC meeting to the three to seven partners with authority. Done means a recorded vote against the graded packet.
8. **Close confirmatory diligence post-term-sheet** - Use the roughly 30-day window to re-verify decisive signals and re-pull the cap table before the wire. Done means the window closes with no surprises, then funds move.

On timing: the memo itself is not the bottleneck at early stage. An institutional investment memo can take two weeks to as long as a year, averaging about two months, but a PE analyst can turn a memo in 2 to 4 days. For a sourced seed deal, the grading work in steps 1 through 5 is the load; the write-up is a formality once the claims carry sources.

#### The early-stage diligence timebox

1. **Seed diligence** - 2 to 4 weeks of pre-term-sheet verification and reference calls
2. **Deal memo and vote** - memo circulated within 24 hours of IC, 3 to 7 partners decide
3. **Term sheet signed** - grade attaches to the packet as of this moment
4. **Confirmatory diligence** - roughly 30 days to re-verify decisive signals before the wire

*Seed diligence and the confirmatory window bracket the partner vote.*

## How this grade goes wrong

Every failure mode here is a false positive: something that reads as Verified but is not. This is the most valuable part of the standard, because a rubric that only counts checkboxes will grade a coached deal green. Each row names the trap and the check that defeats it.

| Failure mode | Why it passes | The check |
|---|---|---|
| Credential inflation | LinkedIn says "worked at Google" | Employer HR dates, not self-description |
| Founder-chosen references | Three coached, happy calls | Get the full list, you pick who to call |
| Fabricated revenue | A clean dashboard screenshot | Stripe or bank statements, not an image |
| Verbal "signed" partnership | Enthusiastic language, no paper | The executed PDF; in-progress does not count |
| Broken IP chain of title | MVP looks owned | Assignment agreement from every contributor |

Two of these deserve extra weight. The first is IP, the highest-frequency silent killer. A named practitioner reports investors find missing IP assignments at Series A more often than any other diligence issue. It survives to diligence undetected because paying a contractor does not transfer IP by default; the mechanism is a legal default rule, not fraud. The documented cost is severe: in one case, diligence revealed a co-founder built the core algorithm while employed at Amazon with no assignment agreement, the VC killed the deal, and six months later the round closed at half the original valuation with 15% equity surrendered. Confirm a signed invention-assignment agreement from every founder, employee, and contractor, and check the contributor list against the company's public code.

The second is the warm-partner illusion. A friendly partner meeting is not a done deal; enthusiasm followed by silence while backchannels run is the normal shape of a deal collapsing. The rule holds: the grade is only Verified when the calls are complete, never when the room feels good.

> The decisive reference is always the one the founder did not choose for you.

## Shelf life: why a Verified grade decays

A Verified grade is a snapshot, not a certificate. No public source publishes a signal-by-signal shelf life, so treat this as an original discipline rather than a citable standard. The anchor is the roughly 30-day confirmatory window, which is where a Verified grade goes stale rather than where it is earned. Between 15% and 25% of signed term sheets never close, and the cause is usually references going sideways or financial projections failing under re-check.

The cap table is the fastest-moving signal, because each new SAFE re-models ownership. A packet graded Verified three weeks ago may carry an ownership picture that is already wrong. This is the four-week window where most founders relax, and the deal can still die here. Do not relax with them.

#### Re-verification priority in the confirmatory window

Horizontal axis runs from Slow-moving signal to Fast-moving signal. Vertical axis runs from Low decision weight to High decision weight.

| Quadrant | What it means |
| --- | --- |
| Founder bio | verify once, no re-check |
| Cap table | re-pull before the wire, every time |
| Office lease | skip, immaterial to decay |
| Customer references | re-check if the round has been open weeks |

*Grade decay is worst where a signal moves fast and matters to the thesis.*

Practically, this means the confirmatory window is not a victory lap. Re-pull the cap table, re-confirm the one or two references that carried the traction grade, and re-check that projections still hold. If any of those move, the grade drops from Verified back to Conditional and the memo gets a note before the wire.

## The completeness checklist

Run this before you call any deal Verified. It is the checkable form of everything above: each item is a statement you can mark true or false, and a Verified grade requires all of them true. Anything false pushes the grade to Conditional or Not Ready.

#### Verified requires every box

- [ ] The three to five load-bearing claims are written down and ranked by impact and uncertainty.
- [ ] Basic screening cleared the cap table and every founder's history with no red flag.
- [ ] Revenue is confirmed against a Stripe dashboard or bank statement, not a screenshot.
- [ ] Every claimed contract or partnership has an executed PDF on file.
- [ ] Every founder credential is confirmed against employer dates, not self-description.
- [ ] At least one paying customer you selected from the full list has confirmed traction.
- [ ] At least two investor references the founder did not suggest have been reached.
- [ ] A signed invention-assignment agreement exists for every founder, employee, and contributor.
- [ ] The memo ends with an explicit grade: invest, pass, or conditional, with conditions named.
- [ ] The cap table was re-pulled inside the confirmatory window before the wire.

> **Tip:** Write the grade into the memo's first line
>
> Ramp's guidance is to end the memo with a clear recommendation - invest, pass, or conditional - and if conditional, spell out the conditions. Put the grade at the top too, so partners read the packet knowing what it claims to be.

## Keeping the standard current

Adopt this as team policy by fixing three numbers to your firm and re-checking them, not the underlying method. First, your reference-call count: pick 5 to 7, or the 3-customers-plus-2-investors floor, or 15 to 25, and write it into the rubric so no partner grades traction by a different bar. Second, your timebox: seed diligence at 2 to 4 weeks and confirmatory at roughly 30 days are typical, but a competitive round compresses the pre-term-sheet phase, so default such deals to Conditional and lean on the confirmatory window.

Third, re-verify decay signals inside the confirmatory window every time, because the cap table and customer references are the two that move. The method - claim-first framing, primary sources for decisive claims, off-list references, a clean IP chain, and an explicit grade - does not expire. The evidence behind any single deal does. Grade the packet, name the sources, state the shelf life, and re-pull what moves before the wire.

## Frequently asked questions

### When is a deal ready for investment committee?

A deal is ready for IC when every load-bearing claim carries a named primary or public source and reference calls are complete, including off-list voices. If any decisive claim still rests on a founder screenshot or a verbal partnership, it is not Verified and should go in as Conditional with the missing corroboration named. The verdict, not the volume of documents, decides readiness.

### How many reference calls should I run before the partner vote?

It depends on your firm's policy, but named sources cluster between 5 and 25. CRV recommends 5 to 7 total conversations, Hustle Fund sets a floor of 3 paying customers plus 2 non-founder-suggested investors, and top-tier firms are reported to run 15 to 25. The number that matters for a Verified grade is at least one customer you chose from the full list, not a warm intro.

### What is the most common issue that kills a deal in confirmatory diligence?

Missing IP assignment. A named practitioner reports investors find missing assignments at Series A more often than any other diligence issue, because paying a contractor or building an MVP pre-incorporation does not transfer IP by default. It survives undetected because it is a legal default rule, not fraud, so confirm a signed invention-assignment agreement from every contributor.

### How long does early-stage diligence take?

Seed diligence before the term sheet runs about 2 to 4 weeks, Series A four to eight. After a signed term sheet you get roughly 30 days of confirmatory diligence, and the full seed term-sheet-to-wire span is about 4 to 6 weeks. In competitive rounds, more diligence shifts to the post-term-sheet window, which makes the packet at IC structurally thinner.

### Does a Verified grade expire?

Yes. No public source publishes a signal-by-signal shelf life, but the roughly 30-day confirmatory window is where a Verified grade goes stale, since 15% to 25% of signed term sheets still die there when references or projections fail under re-check. The cap table decays fastest because each new SAFE re-models ownership, so re-pull it before the wire.

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*From the Refolk guide library. I revise these guides rather than replacing them, so the current version is always at https://www.refolk.ai/guides/pre-ic-deal-readiness-standard*