Every year on April 9th, National Unicorn Day honors the legendary horse-like creature with a singular, pointed horn emerging from its forehead. However, in the realms of business and technology, the term “unicorn” has acquired a new connotation.
Unicorn companies are privately-held startups valued at over $1 billion, and they are disrupting various industries and changing the way we live and work. In this article, we’ll explore the history of the term “unicorn company,” and take a closer look at some of the most well-known unicorn companies, including Stripe, Bytedance (TikTok), Canva, Klarna, Grammarly and the new kid on the block, OpenAI.
History of Unicorn Companies
The phrase “unicorn company” was initially introduced by Aileen Lee, a venture capitalist and founder of Cowboy Ventures, in a 2013 TechCrunch article. Lee remarked that “unicorns” were scarce, akin to highly successful startups with a valuation exceeding $1 billion. She contended that the swift emergence of unicorn companies indicated a new age in technology entrepreneurship, where startups could attain substantial scale and worth more rapidly than ever.
From that point, the quantity of unicorn companies has consistently risen, with new additions joining the list each year. As per CB Insights data, “as of March 2023, there are over 1,200 unicorns” globally, with a collective valuation surpassing $3,867 billion.
Facebook, which reached a $1 billion valuation in 2007, just three years after its inception, made it the first company to be dubbed a unicorn. Presently, Facebook boasts a valuation of over $1 trillion, making it one of the most triumphant companies in history. Other initial unicorn companies include Google, LinkedIn, and Groupon.
Here are some of the most well-known unicorn companies:
Bytedance ($225 billion)
ByteDance, the powerhouse corporation responsible for the immensely popular short-video app TikTok, has secured its position as a significant force within the global tech sector. Established in 2012 by Zhang Yiming, ByteDance has broadened its scope beyond TikTok, developing other thriving applications like Douyin, the Chinese equivalent of TikTok, and Jinri Toutiao, a news aggregator driven by artificial intelligence.
The firm has experienced rapid growth and is now considered one of the world’s most valuable start-ups with a valuation of $225 billion, making it the top-ranked unicorn.
Stripe ($50 billion)
In 2010, brothers John and Patrick Collison founded Stripe with the aim of simplifying online payment acceptance for businesses. Since its inception, Stripe has expanded into a global enterprise, serving millions of businesses, both small and large, in over 120 countries.
Stripe has revolutionised the online payment industry by offering a straightforward and user-friendly platform for businesses to process payments. The company’s APIs and tools enable businesses to seamlessly incorporate payment processing into their websites or mobile apps while also providing advanced features such as fraud detection and subscription management.
The emphasis on developer experience and customer support has made Stripe a favored option for both startups and established companies, resulting in impressive growth.
Canva ($40 billion)
Canva, founded in 2012, has rapidly become a successful Australian startup, with its user-friendly platform making professional design accessible to over 100 million users across 190 countries. The idea for Canva came about when co-founder Melanie Perkins noticed students struggling with complex design software and sought to create a more approachable alternative.
The platform has disrupted the graphic design market by making design available to everyone, regardless of expertise. Its intuitive interface and drag-and-drop design tools enable users to create polished designs, opening up opportunities for small businesses and entrepreneurs who may not have had the resources to hire a professional designer previously.
Moreover, Canva has challenged the traditional design software market, providing a more affordable and user-friendly option compared to professional software like Adobe Creative Suite. This has pushed conventional software providers to adapt and offer more accessible and cost-effective solutions in a changing market.
The online platform has revolutionised the design industry, making it easy for anyone to create professional-looking designs without the need for specialised software or design skills.
Open AI ($20 billion)
Founded in 2015 by visionaries such as Elon Musk, Sam Altman, Ilya Sutskever, and Wojciech Zaremba, OpenAI is an AI research and implementation company.
The company’s mission has resonated with leading investors and technology firms, solidifying OpenAI’s position as a major force in the AI research domain. OpenAI’s projects, such as GPT4, showcase the transformative potential of AI in areas like natural language processing, content creation, and automation.
Besides advancing state-of-the-art AI research, OpenAI actively partners with research and policy institutions worldwide to create a collaborative community addressing AGI’s challenges. This cooperative approach ensures AGI’s advantages are widespread and accessible, ultimately paving the way for a future where AGI can solve intricate problems and enhance people’s lives globally. The organisation’s influence on the AI research field has accelerated AI technology development and fostered discussions on ethical AI creation and implementation.
Grammarly ($13 billion)
Founded in 2009 by Ukrainian entrepreneur Max Lytvyn and a team of engineers, Grammarly is an AI-driven writing assistant that enhances users’ writing by detecting and rectifying errors in spelling, grammar, and punctuation.
Since its inception, Grammarly has evolved into one of the world’s most sought-after writing tools, boasting over 30 million users globally.
Grammarly’s groundbreaking influence on the writing and editing industry is substantial. Conventional writing tools like Microsoft Word and Google Docs have always featured spelling and grammar checkers, but Grammarly surpasses them by employing cutting-edge AI algorithms to offer more comprehensive feedback on writing quality, style, and tone. Thanks to its intuitive interface and tailored suggestions, Grammarly has emerged as the preferred writing tool for students, professionals, and anyone seeking to enhance their writing abilities.
Klarna ($6.7 billion)
Klarna, a Swedish fintech firm, has transformed the conventional banking model by offering a groundbreaking payment system that lets customers “purchase now, pay later” and spread their payments over time. Established in 2005 by Sebastian Siemiatkowski, Niklas Adalberth, and Victor Jacobsson.
Klarna’s groundbreaking payment platform has fundamentally altered how consumers view their finances. With Klarna, customers can buy items online and opt to pay for them in installments later, rather than needing to pay the full sum upfront. This has made shopping more accessible and affordable for consumers, particularly for those who may lack the financial means to make significant purchases immediately.
Klarna’s inventive approach to payments has also motivated other fintech firms to create similar solutions, contributing to the overall expansion and evolution of the fintech sector. As an increasing number of consumers adopt digital and mobile banking options, it’s evident that Klarna’s influence on the market is just getting started.
Conclusion
Unicorn enterprises have revolutionised multiple sectors and altered how we live and work. These businesses have disrupted conventional models by offering inventive solutions that simplify life and enhance efficiency. From Stripe’s smooth payment processing to Airbnb’s budget-friendly travel lodging, and TikTok’s novel content creation approach, these companies have demonstrated that innovation can originate from any source.
The timeline for unicorn companies is comparatively brief, with the term only being introduced in 2013. Nevertheless, the influence of these businesses has been immense. With over 1200 unicorn companies worldwide, it’s evident that the unicorn trend is here to stay.
As we commemorate National Unicorn Day, let us pause to acknowledge the magic of these enterprises and the individuals behind them. These companies have transformed industries and introduced new ways of conceptualising innovation and entrepreneurship. It is intriguing to ponder what the next unicorn company might be, but one certainty remains – it will be distinctive, valuable, and make a considerable impact on the world.
