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?

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.

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.

1. Airbnb; Founded in 2008, this company has changed the way we think about
accommodation by revolutionizing the sharing economy.
2. Uber; This ride-sharing company established a completely new market in transportation.
Founded in 2009, Uber currently has operations in 785 metropolitan areas worldwide.
3. 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.

The value of unicorn startups is based on investors’ assessment of their growth opportunities
and expected long-term development in the market. Investors take into account long term
forecasting to make informed estimates and predictions for future trends.

Valuations for unicorns also stem from rounds of funding from large VC firms investing in them.
Another factor to consider is when a larger company buys out a small startup company,
instantly increasing a startup’s valuation. A great example of this when Facebook bought
Instagram on September 12, 2012—cementing its $1 billion acquisition.

So, a unicorn’s valuation is not dependent on its financial performance. It becomes more tricky
when unicorns don’t have competitors or they are pioneers in that industry. Here, they don’t
have business models for which to compare.

For high-growth startups who are looking to increase their chances for high valuations, it boils
down to opportunities available and their potential. VC firms need to believe in the whole
vision set by the startup owner and the company. Startups should be able to convince VC firms
that they have the capability to grow their business and make it profitable.

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.

Source: https://www.inacademy.eu/blog/whats-a-unicorn-startup-company/

Answer these questions.

1. What is unicorn?
Unicorn is disruptive software that innovated by filling/creating a gap in the market and
initiating a technology paradigm shift.

2. Who was first coined the term unicorn in 2013?

Unicorn was first coined in 2013 by Aileen Lee.

3. How the term unicorn was first appeared?

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.

4. According to the text, what are three characteristics of unicorn?

They ride disruptive innovation to success, they’re the first players on a new market,
they’re consumer-focused.
5. What is decacorn?
Decacorn is companies crossing the border of $ 10 billion in value

6. The value of unicorn startups is based on?

The value of unicorn startups is based on investors’ assessment of their growth
opportunities and expected long-term development in the market. Investors take into
account long term forecasting to make informed estimates and predictions for future
trends.