Index Ventures, a venture capital firm based in Switzerland that also has offices in London and San Francisco, is expanding to New York. The new office will be headed by two Index veterans: Shardul Shah, who joined the firm 14 years ago as an associate from Summit Partners, and Martin Mignot, who joined 12 years ago after working as an investment banking analyst at UBS. Shah is flying in from San Francisco, and Mignot is flying in from London to join him.
We spoke with the two about the decision yesterday, and they were eager to point out that Index has a long history of investing in New York-based startups, with more than a dozen now in its portfolio and approximately 20 throughout time, including the observability firm Datadog, which went public in 2019. Nonetheless, for a number of reasons, they claimed, Index decided it was time to set up shop. For starters, Shah pointed out that having a New York office helps the business to better serve both its San Francisco and London-based staff and founders because the city is in the heart of the 10-hour time zone that runs from the Bay Area to Tel Aviv.
Index could have better access to talent in New York and the developing tech centres that are considerably closer to New York, such as Toronto and Miami, thanks to the new office. Mignot also noted that, in the past, European entrepreneurs going to the United States would have started on the West Coast, but now New York is the first port of call. “It’s easier to deal with the time difference.” The city has reached a stage where it has enough talent and early consumers to [rationalize] putting together a full-fledged staff on the ground. It’s also cosmopolitan and varied. “Foreign-born employees account for half of the city’s IT workforce.”
Other reasons for the now 26-year-old firm’s first new office in more than a decade include: Shah mentioned the increasing presence of Facebook, Amazon, and Google, which just completed a 1.3 million-square-foot headquarters in Hudson Square last month. Also in New York: a slew of hedge funds, private equity funds, and other growth-stage investors with whom Index has forged closer ties in recent years, as it has amassed greater and larger sums of money to invest. Index announced a record $3.1 billion in financial commitments across new seed, early-stage, and growth funds less than a year ago.
Market circumstances be damned, the business vows it will continue to actively deploy that cash. When asked about the slowdown in later-stage acquisitions and a nearly closed IPO window, Shah claimed that “85% of our firms have robust balance sheets, and as a result, none of them are dependent on going public as a method to get financing.”
Meanwhile, Mignot believes that, given the slowdown, this is a good moment to write new checks. “It’s possible that a lot of the visitors have left the market,” he remarked. In any case, given Index’s strong track record throughout the world, as well as in the region, the new office — which will debut in September in central Manhattan — appears to be good news for East Coast creators.
Some of its local bets include Squarespace, a website building and e-commerce platform that went public last year; Wiz, a cloud security company valued at $6 billion by its backers last fall; and Fireblocks, a crypto infrastructure company valued at $8 billion by its backers when it last closed a round in January. It might also be excellent news for aspiring venture capitalists and venture capitalists seeking for a change of pace. Index has already began hiring and continues to hunt for anything from administrative staff to strategists to, yes, new investors, while setting up a 10-person team in its new facility.