If you watched the news recently, you would have heard that the Collins dictionary has recently introduced a new term relating to start-up businesses that do not have an established performance record, but hold a stock market valuation or estimated valuation of more than $1 billion. Their definition: Unicorn businesses.
So, where does this term come from? The term was first popularised by the venture capitalist Aileen Lee, founder of CowboyVC, a seed stage venture capital fund based in California. In her article, “Welcome To The Unicorn Club: Learning From Billion-Dollar Startups,” she looked at software start-ups founded in the 2000s and estimated that only .07% of them ever reach $1 billion valuation. Those that do reach the $1 billion mark are so rare that finding one is as difficult as finding a unicorn. Hence the name.
Lee went on to argue that that the first unicorns were spotted in the early 90’s with Google being the clear “super-unicorn” of the group – with a valuation of more than 100 billion dollars. Subsequent to Google, many Unicorns were born. And although a Unicorn, the creature, remains a mere mythical figure bound to storybooks and imaginations, the Unicorn start-up has become a lot more common than what one might realise.
From AirBnB to Uber to Snapchat, and further afield with businesses like Xiaomi and Didi Chuxing, you may be surprised to hear that more than half of the world’s unicorns are based in the United States. Other countries that play home to the most Unicorns include China (23%), India (4%), the UK (4%), Germany (2%) and South Korea. But surprisingly of all is that no other country has three or more private companies with a valuation of at least $1 billion.
While we’re not surprised that many of these Unicorns find themselves in the e-commerce space, Internet Services and Fintech spaces, up and coming Unicorn ponies are sprouting from the EdTech, Aerospace and Augmented Reality worlds.
All very impressive. But that will never happen to you, right? Wrong.
Just this year, we’ve seen the birth of 22 new Unicorn start-ups alone. And that was in May. Whether it’s the prospect of Brexit that looms, spurring business people to create and innovate, or whether that’s simply down to an already-disrupted marketplace, innovation is all around us. And while some may have been blessed with the insight to spot a potential birth of a Unicorn through the initiative they create, for many, realising just how successful their idea may become, never really crossed their minds.
But that leaves most business owners and start-up founders with one critical question: How ready are you for the responsibility of the potential that your business brings?
Regardless of where you are in the process – having the right team supporting you is critical.
And if you’ve moved past the start-up phase, and you’re realising that your business is growing at a pace that leaves you feeling under-resourced, and ill-prepared, then it’s time to speak to people like us. We’ll help you