What’s a Unicorn Startup Company?
Every entrepreneur wants to create a Unicorn Startup Company – this is not breaking news.
You’ve probably had a conversation about famous unicorn companies like Uber, Airbnb, Snapchat, or Pinterest. But what often goes unaddressed is the meaning of the term itself. Why are some startups called “unicorns”? How are these rare creatures related to billion-dollar companies?
Mastering all concepts of the startup universe will be essential for anyone who wants to become a successful entrepreneur. In this article, we’ve put together everything you need to know about unicorn startup companies.
Unicorn Startup Companies Explained
The unicorn has been a part of our collective imagination for centuries, and over time, it has come to be almost synonymous with rarity. But as a corporate moniker, “unicorn” was first coined in 2013 by Aileen Lee, who identified 39 startups with individual values of more than $1 billion. She felt these companies were as rare as unicorns, and the name stuck.
Six years later, the definition remains the same: A startup company founded after 2003 with a value of more than $1 billion. The only thing that’s changed since then is the number of unicorns. Currently, there are 393 unicorn startups around the globe.
What makes a unicorn?
Numbers are impressive, but behind a one-billion-dollar story, there’s a lot to learn. Let’s take a look at some of the most renowned unicorn startups to see how they’ve changed the market.
Airbnb
Founded in 2008, this company has changed the way we think about accommodation by revolutionizing the sharing economy.
Uber
This ride-sharing company established a completely new market in transportation. Founded in 2009, Uber currently has operations in 785 metropolitan areas worldwide.
Spotify
Streaming music and podcasts is part of our daily routine. But this only became a reality after Spotify was launched in 2006. The Swedish business is one of the most famous unicorn startup companies in the world.
If you think about each of the above-listed unicorns, you’ll realize that they all have something in common: They’re all disruptive software that innovated by filling/creating a gap in the market and initiating a technology paradigm shift. Unicorn startups tend to have the following in common:
- They ride disruptive innovation to success
- They’re the first players on a new market
- They’re consumer-focused
These three characteristics are game-changers and can guide your business toward becoming the next unicorn.
Unicorns X Narwhals
The startup universe is full of fantastical creatures, and the narwhals are another great term you need to learn. This term was coined in 2014 by Brent Holiday, the CEO of Garibaldi Capital Advisors. It refers specifically to Canadian companies that are worth more than C$1billion (like Shopify and Hootsuite).
Narwhals are real creatures found in the arctic waters of Canada. Like unicorns, they too have a “horn” – though it’s actually just a protruding canine tooth. The term was created with respect to the robust startup scene in Canada, and to distinguish its billionaire companies from non-Canadian ventures like Silicon Valley.
Top 10 Unicorn Startup Companies
Curious about the most successful unicorn companies? The 1st entry on this list goes to Toutiao (Bytedance)/TikTok: The most downloaded app in the world, valued at $76 billion. Uber comes in 2nd ($72 billion), followed by Didi ($65 billion). Check out the full list below, according to CBInsights:
- Toutiao (Bytedance): $76
- Uber: $72
- Didi Chuxing: $65
- WeWork: $47
- JUUL Labs: $38
- Airbnb: $29.3
- Stripe: $ 22.5
- SpaceX: $18.5
- Epic Games: $14
- GrabTaxi: $14
What’s next?
From 2014 to 2019, the number of unicorns jumped from 39 to 393. But will this growth be sustainable and scalable over the coming years? The answer is still uncertain. Becoming a disruptive “first-player” on the market is not an easy task, but the future does look promising for some companies.
Meanwhile, the number of Decacorns or Super Unicorns is still growing, with more companies crossing the border of $10 billion in value. We can be sure that there’s a lot more to come in the unicorn startup company universe.
Wanna know more about startups? Check out the EIA blog!
