The One Question That Tells You If a Founder Is Investable

Originally sent to Play Money subscribers in January 2026
This weekly note explores how experienced angels think about risk, diligence, and decision-making.

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💎 Angel portfolios work because of diversification. Optimizing for 30+ investments over time will deliver a better return than any optimizing for a single variable for a handful of deals.

But "edge" comes from the questions we ask inside that diversification. The game isn’t to find “the one perfect deal,” it’s to write enough right‑sized checks into deals with "edge". That requires asking the right questions.

We had a number of seasoned Angels join us for Angel 101 last week - and they provided rich insights on what they look for as they diligence startups.

I pulled some of the best questions and answers from the Angel 101 session, plus a few key insights from one of my new favorite angel bloggers, to pull back the curtain on how experienced angels really think about founders, use of funds, and what’s hiding underneath those shiny decks.

Enjoy!

-- C2K

Angel Investing Due Diligence: Questions Experienced Angels Ask Founders

Amazing questions, and answers, from our audience....

Q1: If You Could Only Ask One Question: With so many things you could diligence, what’s one simple question you always ask that most new angels don’t—but that tells you a lot about whether to trust a founder?

Pam S - experienced Angel (Ollie, Invisalign); syndicate lead for Bairitone Health
“I always ask: ‘Can you send me the last investor update you sent, and how often do you send them?’ If they pause, hedge, or say it’s once a year, I’m out.

Q2: Scaling Sales: If a pre‑Series A founder is using funds for paid ads or to hire a sales team, how should I think about that in diligence? Smart growth or red flag?

Kelly H. - experienced growth stage sales leader
“If the founder hasn’t already proven they can sell this themselves a sales team and ad spend is usually a red flag. Salespeople don't magically fix lack of "market pull".

Q3: Market Sizing: Founders always show huge TAM (total addressable market) slides. How much weight do you actually give those numbers, and how do you use them when you’re deciding whether to invest?

Cheryl K - Play Money, 3x founder, experienced angel
“Most TAM slides are wrong. In the early stage "tops down" thinking about your business isn't as helpful as a bottoms up approach.

How many targets do you have in market? How much are they willing to pay? How much do you need to sell to hit key inflection milestones? Bottoms up forces a founder to understand who really pays, how often, out of which budget, and what has to be true for that to scale."

Q4: Generalist or Specialist: Is it better to be a generalist angel, or should I specialize in a couple of sectors so I can see patterns faster?

Juliana U. - Experienced Angel, former F500 exec
There are different ways to angel invest. I’ve found it’s much more powerful to pick a few areas—like fintech or B2B SaaS—and go deep instead of trying to have a view on everything.

When you see dozens of similar companies, you start to recognize what ‘good’ looks like in that specific model: how customers really behave, what realistic revenue looks like, which go‑to‑market motions actually work. That pattern recognition makes your ‘no’s’ faster.”

How Experienced Angel Investors Evaluate Founders and Startups

Susan Montgomery is an experienced angel who writes some of the clearest, least‑fluffy guidance on how she makes decisions. Here are my faves:

What she looks for first in a founder (full post)

Founder Obsession with the Customer

"If I had to reduce founder quality to one core attribute, it would be obsession with the customer. Not passion for the product. Not belief in the mission. Obsession with the customer.”

C2K Note: I learned this the hard way at my last company. I was obsessed with the problem and mission. But I did not love my actual decision making, budget holding customer. It made my job *very* unfulfilling even when we were growing rapidly.

Founder Self-Awareness and Intellectual Honesty

Susan's favorite question is “What part of running this business are you going to be bad at?” (FWIW: as an experienced founder I could hand you a list!). She then watches whether the founder can answer cleanly and admit uncertainty.

She pays attention to whether they can say “I don’t know” without collapsing, and whether they push back thoughtfully when she suggests a bad idea on purpose. “Yes people” are a red flag.

What she looks for first in the business (full post)

The “Invisible Truth” a Product Makes Visible

She tells a great story about investing in Uber. Uber wasn't about a faster taxi service. It was about realizing the product made idle capacity visible in a system that assumed scarcity.

Her “curtain moving" question for tech companies: what are you making visible that already exists—idle assets, time, trust, money—that tech now coordinates?

One Clearly Impacted User vs a Perfect TAM Slide

She wants to see one real user whose life is clearly better the first time they use the product. “If you cannot find that person, do not invest. If you can, stay close.”

The way that user leans forward during a messy demo tells her more than any market‑size slide.

🤞🏽 Fingers crossed we can do a full AMA with Susan later this quarter. 

Angel Investing Decision Triggers: Your In-or-Out Questions

What do you think? What is your biggest 'in or out' trigger?

Drop us a note on the questions you always look to understand. Maybe we'll call them out more explicitly in our founder interviews and memos.

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