How do you optimize reference checks for prospective employees? originally appeared on Quora - the knowledge sharing network where compelling questions are answered by people with unique insights.

Answer by Stan Hanks, building "the Internet" since 1981, now building web-scale companies, on Quora:

I used to pretty much put reference checks in the "Eh, another check box" category. Until I got burned, badly. Now it's almost religion.

Note: these are all disqualifiers -- I have to have my mind made up that I like the person, think they're a good fit for the team, believe that they can do the job, and really want to hire them. It's a pretty high bar to get to that point -- I'm hiring adverse, and use contractors for things that are short-lived or low-value, and for me to really want to put you on the team full-time is a big deal.

But like all humans, I suffer from confirmation bias, and once I believe that I want to hire you, I tend to see the things that reinforce that, not the things that would blow it up. So I have someone else play Devil's advocate and try to disprove that I should hire the person.

I actually outsource this process, sometimes to more than one firm.

There are three basic types of reference checks that I run:

1) Professionally, is this person who they say they are, and have they done what they say they've done? That means verifying education, degrees, prior jobs -- which can be hard in startup-land, where companies vanish into the night with great regularity, checking code bases for their commits, checking claimed publications for their existence. If it's on their resume, it gets checked. If it's mentioned in passing and is not on their resume, it gets checked.

2) Personally, is this person going to be trouble? That means criminal background checks, checks for disciplinary actions with previous employers (hard to do, that's a potential liability for the previous employer if they disclose improperly and the definition of "improperly" is fluid).

3) Financially, is this person going to be a risk? This is particularly true for officers, those in positions of financial responsibility, and those with access to key intellectual property. It involves pulling credit reports, estimating returns from prior engagements, and then lifestyle assessment -- if I guy was a key team member on a startup with a big exit, then having him show up in an expensive car isn't a big deal; however, if he's in a Bentley and there's no reason to believe that he can afford it ...

If there are discrepancies, there may, or may not, be an opportunity to explain them. If it's bad -- like an undisclosed criminal record, or huge financial instability in a CFO, probably not. If it's blatant -- like a Ph.D from Harvard that turns out to fictitious, yeah, not so much. If it's minor, maybe, particularly if it's easily explained as an oversight.

Or maybe not. Character is what you do when no one is looking. If you thought I "wasn't looking" and did something untoward ...

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