UNICORN STARTUPS | Meaning Unicorn | Definition Unicorn | Entrepreneurship | Entrepreneur | Airbnb

Puzzled by the buzzwords in business? Perplexed by your profit margins and pivots? Don’t know what the difference is between a SaaS and a PasS? Don’t worry about it! Getting to grips with business jargon is tricky, but I’m here to explain it all to you. If you are just starting out in business or have dreams of becoming an entrepreneur, my series Speak Like Shaf will explain all these terms to you and throw in the occasional entrepreneurial tip. This week, we are going to be looking at the term “unicorn”.

So what is a unicorn? It’s a mythical creature, of course. You know, looks like a horse with a spiralling horn on its forehead. It’s also the national animal of Scotland. Seriously, it is! Google it if you don’t believe me. Oh, sorry, I’m going off on a tangent. Let’s get back to business terms instead of legendary animals.

Right, in the business world a unicorn has a very different meaning. In the venture capital industry, a tech start-up company that reaches a $1billion dollars market value as determined by private or public investment is known as a unicorn. The term was originally coined by Aileen Lee, founder of Cowboy Ventures. It was a great choice of phrase by her because it really sums up how rare achieving this feat would be. When she came up with this phrase in 2013, there were only 39 companies that were unicorns. Last year, it was estimated there were 119 private companies worldwide that were valued at $1billion or more.

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So we can see how rare it is, but also that it’s possible to do it. Let’s take Airbnb as an example. It was founded in 2008 in San Francisco when two pals, Brian Chesky and Joe Gebbia, couldn’t afford the rent on their apartment. The story goes that they stuck an air mattress on the floor and started providing bed and breakfast. Today, the company is an online marketplace and hospitality service brokerage company and members can book short-term lodgings in a variety of vacation rentals, apartment rentals, hostel beds, or hotel rooms. Airbnb has over three million lodging listings in 65,000 cities and 191 countries and in December 2017 was valued at $31billion. Not bad for a company that literally started in someone’s living room.

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During my Speak Like Shaf series, we’ve met Rab The Rock Star. He’s my Stone Age chum, the entrepreneur who came up with the idea of making and selling and renting tools to cavemen hunters to help them get better results and catch more boar and deer to eat. I’d love to tell you that his company, Goresticks, was the first unicorn, the first company to reach a valuation of $1billion…but I’d be lying. Frankly, money was in its infancy in those days. In fact, the first medium of exchange was polished mammoth tusks.

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As a side note credit for the first recorded medium of exchange should be given to Rab and his contemporaries. But that’s for a future video.

Back to our friend Rab, he’d have more chance of seeing a real unicorn than seeing his company become a unicorn.

Thankfully, we aren’t stuck in the Stone Age and we’re seeing more and more unicorns in the business world. If you are starting out, dream big and aim to see your company reach the dizzying heights of $1billion. But I would advise you to keep your feet on the ground, the odds of doing it are not in your favour. Mind you, I’m sure Brian Chesky and Joe Gebbia couldn’t have imagined when they were figuring out how to pay their rent in a small flat in San Francisco that their idea would become the global success story it has.

Have you got the idea for the next unicorn but not sure what to do? Simple, check out my YouTube channel and let me help you understand business. I’m bursting with advice and ideas and I can’t wait to help you. And remember, all you have to do is go hit the subscribe button and the bell icon. See you next week for another ‘Speak Like Shaf’.