Subscribe to Entrepreneur for $5
Subscribe

What are unicorn companies?

What do we mean when we talk about a "unicorn" in the entrepreneurial ecosystem?

This article was translated from our Spanish edition using AI technologies. Errors may exist due to this process. Opinions expressed by Entrepreneur contributors are their own.

If you are immersed in the entrepreneurial ecosystem, you have surely heard of the so-called “unicorns”. And it is that they are talked about everywhere, from the viral video "Hot Crazy Matrix: A man's guide to women" to Tech Crunch in his articleWelcome to the Unicorn Club: Learning from billion-dollar startups or Fortune, with his list of the 80 unicorn startups . But what do we mean when we talk about a "unicorn" in the business environment?

Depositphotos.com

By definition, a unicorn is a fabulous and mythological animal. But in business this term has a somewhat different connotation.

In November 2013 Aileen Lee , founder of Cowboy Ventures, was the first to introduce the term. He was referring to a technology company that reaches a value of one billion dollars in some of the stages of its capital raising process. According to Aileen, these "unicorns" used to be a myth or a fantasy. But now it seems like we find at least four such companies a year, backed by a new generation of disruptive technology .

In 2013, Aileen told us about the Club of 39 Unicorns - which represent .07 percent of B2C and B2B software startups. As of today, Fortune has more than 80 companies that have been valued in excess of $ 1 billion (pre-IPO). The ones topping the charts are Facebook ($ 122B), Xiaomi ($ 46B), Uber ($ 41.2), Linkedin ($ 25B), Palantir ($ 15B), Airbnb ($ 13B), Workday ($ 12B), Flipkart ($ 10.6 ), Dropbox ($ 10.4), Snapchat ($ 10B), and Twitter ($ 9B).

Here are some interesting facts about unicorn companies:

-They emerged in the era of social networks , and they knew how to take advantage of their boom to consolidate and grow.

-They are B2C, that is, they develop a commercial strategy to reach the customer or end consumer directly.

-On average, in the past decade four unicorn companies were born per year. Facebook was the "super unicorn" star, valued at more than $ 100 billion.

-They have generated approximately 26x more value for every private dollar invested.

-The average age of the entrepreneurs who founded them is 34 years old.

-Your teams are made up of three entrepreneurs on average.

-90 percent of companies have founders who already knew each other before, at school or at work.

-Only two of the unicorn companies were founded by women (Gilt Groupe and Fab). And currently, no CEO of these companies is a woman.

-The last conclusion is alarming, and even more so coming from a developed country (27 of the 39 Unicorn Club companies are based in San Francisco). This means that there is a huge opportunity and a lot to do.

And you, what would you have to do to stop aspiring to be a unicorn and become one?

This note was originally published in Victoria 147 .