Screening only compounds if it is written down, identical every time, and produces a record - which is what turns a year of declined opportunities into knowledge about a category.
11 min read · Level 2
Almost every investor I have seen build a screening process builds one that is too elaborate on the first attempt, and the elaborate version is abandoned within a quarter rather than simplified - which means the failure mode is not a worse process but no process at all. There is a strong pull towards comprehensiveness here, because each additional question is individually defensible and nobody wants to be the investor who missed something obvious by not asking. But a screen is not a diligence checklist and should not be judged by what it covers; it should be judged by whether it is run identically on the deal you are excited about and the one you are not. My own view is that the right number of questions is the number you would still ask at nine in the evening on the day a founder you admire has just given you a compelling pitch, which for most people is about four. Everything beyond that belongs in diligence, where there is time, rather than in a filter, where there is not.
A repeatable screen is a short, fixed set of questions asked of every opportunity in the same order, with the answers recorded in the same place. It has four components:
Component What it does The intake record Source, date, category, who introduced it, one-line description The anti-thesis Checked first, because it is the cheapest possible no The disqualifying One thesis-derived question with a pre-decided wrong answer question The decision log Outcome, the reason in one sentence, and the date
The order matters. The anti-thesis check costs seconds and removes whole categories. The disqualifying question costs one exchange and removes opportunities that are in your category but not your belief. Only what survives both earns a real conversation.
What makes a screen repeatable rather than merely written is that the questions do not change between opportunities. This sounds trivial and is the hardest part in practice, because an interesting opportunity invites an interesting conversation, and an interesting conversation does not follow your list. The discipline is to have the conversation and then still ask the questions.
The component most often skipped is the decision log, and it is the one that compounds. A one-sentence reason, recorded at the time, does three things a memory cannot. It lets you find out later whether your reasons were good, because you can look up what you actually said before the outcome was known. It shows you the patterns in your own declines - four opportunities declined this year for the same reason is a finding about the category. And it makes the follow-up honest, because a specific reason can be given to the person who introduced it.
A screen also has to record what it learned about the category rather than only about the company. The answers to your disqualifying question, gathered across dozens of opportunities, are primary evidence about how that market behaves - often the best evidence you will have, and free, because you collected it while doing something else.
Because the value of screening is almost entirely in consistency, and consistency is exactly what does not happen without a written process. An investor screening from judgement alone applies a different standard in a busy week than in a quiet one, a different standard to a warm introduction than to a cold one, and a different standard when they have capital burning than when they do not. None of those variations is deliberate and all of them are large.
It also removes a specific social cost. "That is outside what I invest in, here is why" delivered in a day, from a written standard, is a professional answer that preserves the relationship. The same decision reached over five weeks of drift reads as disinterest, and the introducer learns nothing about what to send you next time. A screen makes the fast no possible and therefore makes it likely.
The third reason is that it is the only way the year adds up to anything. Without a record, three hundred opportunities produce five investments and no knowledge. With one, they produce five investments and a dataset about a category that nobody else has - what companies in it are actually doing, how they sell, what they charge, which assumptions are holding. That is the compounding asset in sourcing, and it is a by-product of a process that was running anyway.
And it disciplines the story you tell about yourself. Most investors believe they have a thesis and a focus. The decision log is the check: if the reasons recorded over a year do not look like your stated thesis, then your actual standard is different from your stated one, and you now know it.
Educational, not personalised financial advice. Nothing in the Investor Academy is a recommendation to buy, sell or hold anything — what is right for you depends on your own circumstances and the rules where you live.
One screen, one page, used unchanged on every opportunity.
1 Source and date who, when, and how it reached me 2 Anti-thesis check does it hit a written exclusion? if yes, stop 3 One-line description what the business does, in my words not theirs 4 Disqualifying question asked in the first exchange, answer recorded 5 Decision pass / first meeting / diligence 6 Reason, one sentence written before the decision is communicated
A month of entries, abbreviated.
Source Anti-thesis Disqualifying answer Decision Reason Cold email - "we do not track that" pass no evidence of the motion Operator - 14 of 20 daily users diligence fits the belief squarely Event hardware - pass written exclusion, no exception Co-investor - 6 of 20, rest were owners pass sells top-down, not my thesis Founder - 19 of 20 daily users diligence strongest answer seen this year Cold email gambling - pass written exclusion
What the month cost. Four passes at under an hour each, two real investigations. The two exclusions took under a minute each because the decision had been made in the abstract months earlier.
What the month produced beyond decisions. Four data points about who books demos in this category, three of which supported the thesis and one of which did not. Two written exclusions used, confirming they were worth having. And one observation the investor would not otherwise have made: the opportunities arriving through cold channels were markedly less likely to be tracking the metric at all, which is itself a quality signal and one they had not previously been able to articulate.
The part that took discipline. The co-investor referral was from someone the investor likes and wants to stay close to, and the company was genuinely good. The screen said it sells top-down, which is not their belief. They passed in two days with a real reason, offered to introduce the founder to a better-suited investor, and kept the relationship. Five weeks of polite investigation would have ended in the same place, with less goodwill and no time left for the two that mattered.
Building a screen with fifteen questions. A long screen is not run - it is skipped for the interesting opportunities, which are exactly the ones where a consistent standard matters most, and it quietly becomes a document that exists rather than a process that operates. Four to six items that are asked every single time beat a comprehensive framework applied when there is time, because the version that gets used is the only one with any effect.
If it does not fit on one page it will not be run under pressure. Every item has to earn its place by having changed a decision at some point, and items that have never changed anything should be removed at the annual review.
It is the cheapest no available and it costs seconds. Checking it after you have read the materials means reading the materials first, which is where the attachment starts and where the exception clause begins to look flexible.
Writing it first forces the reason to be real, because a sentence you have to stand behind is different from one assembled while typing a polite reply. This is also the record you will read in two years when you find out how the company did.
One row per opportunity, in one place, with the disqualifying answer in its own column. The point is to be able to read down that column at the end of the year and see what the category has been telling you.
Read a year of recorded reasons and ask whether they describe the investor you say you are. Divergence here is not a failure - it is the most direct evidence available about what your real standard is, and it usually suggests either the thesis or the behaviour needs to change.
Run the screen on everything, including and especially opportunities from people you know well. Warm introductions are where screens are most often waived and where the consequences of waiving them are largest, because the relationship makes the later no harder rather than easier.
Do not run a mechanical screen in a category you are still learning, where the questions you would ask are not yet the right ones. There the slow, unstructured conversation is the point, because it is how you find out what the load-bearing question even is. A screen encodes a belief; you need the belief first, and encoding a guess simply makes the guess permanent.
Investors who adopt a screening record almost always capture the decision - pass, meet, diligence - and frequently omit the one-sentence reason, or fill it with something non-specific such as "not a fit" or "too early". The record then supports counting but not learning: it can say how many opportunities were declined and in what month, and nothing about whether the declines were sound. When these investors later try to review their judgement, typically after a declined company does well publicly, there is nothing to review, and the reconstruction that follows is shaped by the outcome they now know. The cost of the omission is invisible for about two years and then total.
A decision without a recorded reason cannot be reviewed, because by the time you want to review it you will know the outcome and your memory will already have adjusted.
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