Bloomberg Businessweek February 14, 2022 pp16-20|TECHNOLOGY|”The 1,000th Unicorn Joins the Herd” “There are more $1 billion startups than ever” Edited by Joshua Brustein
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Summary by 2244
Image of girl in a Unicorn costume. With 1,000 firms reaching unicorn status of a $1B or better valuation, not one is led by a women.
Recently a confluence of factors have created a surge in the number of startups reaching a private valuation of $1 billion or more. Key amongst the factors is “the ease and efficiency of software-it’s become the glue that runs how we communicate and how we do business.” This benefit has had an even greater impact as COVID drove much work from office to home.
As of now a startup with such a value, dubbed back in 2013 as a Unicorn, is identified “at a rate of more than one a day.” In 2021 $621 billion of “investment money [was] looking for a home.” That amount of money was double of 2020 and it “exceeds the capital raised through IPOs.” According to Brian Lee (CB Insights) there are “plenty of investors eager to get in on rapidly evolving industries...pushing up valuations…’you can’t discount the power of FOMO…people are willing to go in with more capital.’” Entrepreneurs like being privately-held because it avoids “the additional scrutiny and potential loss of control that comes with an initial public offering.”
Startups in consumer internet services were early unicorns but now “there are more companies in financial technology than in any other category.” Most unicorns overall are American and started by 30 year old males, not a single female led unicorn currently but Elizabeth Holmes would have been had Theranos (Once valued at $9B) not failed so dramatically. “Companies leave the unicorn list by being acquired, going public or failing.” Some top unicorns are listed here. Internet Software and Services (Canva $40B), Data Analytics (Databricks $38B), Education (Byju’s $21B), E-Commerce and Direct-To-Consumer (Xiaohongshu, Chinese), Supply Chain, Logistics, and Delivery (Instacart $39B), Consumer (Yuanqi Senlin, Chinese), Hardware (DJI, Chinese), Fintech (Stripe $95B), AI (ByteDance $140B, Chinese) and other (SpaceX, $100B).
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