UNICORN START-UP DECLINES – HOW FAR?

?A Unicorn is a start-up with a private valuation over US$1 billion.

1201 Unicorns had cumulative valuations of US$3,871 billion as at November 2022.

In 2022 new Unicorns created have fallen – only 25 created in Q3, the lowest since early 2020.

CB Insights has not changed it's valuation chart for many months – strange, considering when values went up, they moved very quickly. Time for CB Insights to step up and rectify this to show a clear picture ?

FINTECH DOMINATED

Back in January 2022, the Unicorn List was dominated by Fintech’s.

The Top 14 had valuations of US$812 billion, since then 26% or US$211 billion has been wiped off valuations, with two Unicorns deleted from the Top 12.

Fintech changes:

Stripe - valuation was US$95 billion in 2021, now US$74 billion

Klarna?- US$46 billion, now US$6.7 billion goes down list

NuBank?- US$45 billion, deleted, now a public company with Nasdaq US$21 billion market cap

CheckOut.com?- US$40 billion unchanged

Revolut?- US$33 billion unchanged

FTX – gone bust

Other changes in the Top 10 Unicorns –

Bytedance (TikTok) – down to US$105 billion

SHEIN?– down to US$75 billion,

Canva?down to US$26 billion

Databricks down to US$31 billion

Instacart?down to US$24 billion

·??Note orange arrow shows Klarna and NuBank ranking before departing CB Insights list

In August only 5 Unicorns had reduced valuations?– now it’s 8 reductions

HISTORY

A Unicorn is a start-up with a private valuation over US$1 billion

2013, there were?43 unicorns ?

October 2015 141

November 2020 the ‘unicorn club’ passed 500

October 2022 1,195 unicorn companies worth US$3,861 billion are listed by CB Insights (this list misses some Chinese and Indian unicorn start-ups). Crunch base has a similar process however the numbers do vary.

In two years since November 2020 695 Unicorns have been created by VC investors with 90% not making any profits

Chart from mid-2021 shows Unicorns by category – Fintech includes Crypto?

In 2022 new Unicorns created have fallen – only 25 created in Q3

Important to note the valuation is based on investors (usually VC’s) selecting the number and agreeing on a valuation. This is all ‘in-house’ between the start-up (hardly and investors, neither are independent.

UNICORNS BY COUNTRY

Unicorns by Country, the US and China dominate with 67%

USA – 622 or 51%

China – 184

India - 69

UK – 46

Germany – 29

France – 24

Israel – 22

Canada – 19

Brazil and Singapore – 15

Indonesia, Mexico and Sweden – 8

Australia – 7

Japan and Norway – 6

Ireland, Hong Kong and Netherlands – 5

Countries with 2- 4 – Belgium, Columbia, Finland, Italy, Spain, Switzerland, Turkey, UAE

Very interesting to see which countries are doing well, while others lag badly, the list across major GDP shows this graphically

UNICORN IPO’s

PitchBook and Morningstar have developed a set of indexes to track Unicorn IPO performances

Indexes include:

• Formerly VC-backed IPOs
• Formerly PE-backed IPOs
• Private companies having entered the public markets via a SPAC
• Unicorns across various geographies