How to Verify a Startup Before Investing

India has 100,000+ registered startups. A fraction of them have verifiable traction, real funding, and honest founders. Here's a checklist you can run in under 30 minutes to separate the real from the hype.

Why startup verification matters

Startup fraud in India is not an edge case — it's endemic. From fabricated ARR numbers to ghost investors, the incentives to exaggerate are high and the consequences (until recently) were low. High-profile collapses like BharatPe, Zilingo, and GoMechanic all had publicly available signals that were ignored.

The good news: most fraud is detectable with free public data if you know where to look.

Step 1: MCA21 registry check

Every legitimate company incorporated in India has a CIN (Corporate Identification Number) on the Ministry of Corporate Affairs (MCA21) portal. Search by company name and verify:

• Company status is "Active" (not struck off or under liquidation)
• Date of incorporation matches what the startup claims
• Registered address is real (not a virtual office with no history)
• Paid-up capital is consistent with claimed funding

A startup claiming ₹50Cr in funding with ₹1 lakh paid-up capital is worth investigating further.

Step 2: Crunchbase funding verification

Crunchbase aggregates funding announcements from press releases, SEC filings, and direct submissions. Search the startup name and check:

• Funding rounds match what was announced publicly
• Investor names are real, identifiable firms or angels
• Lead investors have a track record (check their other investments)

A startup that claims "Series B — $10M" but has no Crunchbase entry and no news coverage of the round is a red flag.

Step 3: Google News search

Search: [startup name] fraud OR scam OR lawsuit OR controversy

Then search: [startup name] funding OR revenue OR growth

Real startups leave a news trail. Growth-stage companies with no press mentions outside of their own blog are worth scrutinizing.

Step 4: App Store / Play Store

If the startup has a consumer product, it should have an app with real reviews. Check:

• Number of downloads (1M+ for a startup claiming mass adoption)
• Review sentiment — are negative reviews about real product problems or fraud?
• Last update date — an abandoned app with recent funding claims is suspicious

Step 5: Website and domain age

Use a WHOIS checker (whois.domaintools.com) to find when the domain was registered. A startup claiming 4 years of operation with a domain registered 8 months ago is lying about its founding date or recently rebranded — both worth investigating.

Step 6: Founder verification

LinkedIn is the easiest cross-reference. Check:

• Previous companies — do they match what the founder claims?
• Education — verifiable institutions, not vague "IIT dropout" claims
• Profile age and connection count — fresh profiles with 50 connections for a "serial entrepreneur" are suspicious

The shortcut: TruthScore

TruthDeck automates this entire checklist. Every startup on our platform gets a TruthScore from 0–100 based on automated checks across MCA, Crunchbase, Google News, App Store, and website signals. Scores above 75 are Verified. Below 45 are Unverified.