In the venture capital industry, the term unicorn refers to any startup that reaches the valuation of $1 billion.
Recently, SaaS platform LeadSquared became a unicorn and raised $153M USD in Series C funding.
We often talk about unicorns like Uber, Airbnb, Snapchat & Pinterest but little do we discuss what a unicorn exactly means. Ever wondered why some startups are given this title? What are the criteria to get this title? Or have you just wondered, how to be a unicorn?
If yes, this guide is for you.
Read further to know all things unicorn!
In the venture capital industry, the term unicorn refers to any startup that reaches the valuation of $1 billion.
The term was first coined by Aileen Lee, founder of Cowboy ventures when she referred to the 39 startups that had a valuation of over $1 billion as unicorns. The term initially was used to lay emphasis on the rarity of such startups. The definition of a unicorn startup has remained unchanged since then. However, the number of unicorns have gone up.
To be a unicorn isn't a piece of cake and each unicorn today has its own story with a list of features that worked in its favor. We have listed down a few pointers that are commonly seen across all the unicorns:
A recent report suggests that 87% of the unicorns products are software, 7% are hardware and the other 6% are other products and services.
According to CB Insights List of Unicorn Companies, there are 1,194 private companies around the world valued at over $1 billion. The US has 664 of these companies, taking 55 percent of the overall share.
The answer is yes. Unicorn is a term only given to ‘startups’ who have a valuation of over $1 billion. The startups that exceed the valuation of $10 billion are grouped under the term called decacorn (a super unicorn). Dropbox, SpaceX and WeWork are some examples of decacorns.
For startups based out of Canada, there is an exclusive term for what we call a unicorn. It is ‘narwhal’. This means that any Canadian startup company with a valuation of over $1 billion is called a narwhal. Hootsuite and Wattpad are two examples of Narwhal companies.
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The word ‘unicorn’ has come a long way from just being a mythological creature to recognized jargon in business and finance discussions. Today, every entrepreneur dreams of becoming a unicorn. Of course, not every unicorn will end up being a successful startup. The moral of the story is that any startup shouldn't stop hustling after touching a milestone at any stage.
Hope this article helps plan to attain all that you have been dreaming of!