Why Does Index Ventures Back Founders Before They Have a Business Plan?

Shardul Shah says Index Ventures backed the founders of Wiz before they had a business plan. The investment happened on his birthday. There was no market, no business model, and no metrics to analyze. At that stage the decision was about the people.

He had served on the founders' board 10 years earlier, so he already knew their flaws and their idiosyncrasies, and he still believed in who they were. The craft he describes is listening until that belief shows up, not screening for a list of traits. Patterns are how venture industrializes: define three patterns, put thousands of entrepreneurs through a filter, and decide with statistics at scale. He does not call that a craft. He also does not treat the work as a private gut instinct that nobody else can see.

Founders still have to build durable businesses. In a market this exuberant, revenue gets confused with a durable model, and some founders cannot define revenue in the first place. The fundamentals matter. The start of the partnership is still the person.