Unicorns; you must have heard about them existing in ancient times, wherein people believed that those who drank from its horn were protected from stomach trouble, epilepsy and poison! They were difficult to capture and could only be caught if another strong animal was placed before them.
But let’s take a step aside from the world of fantasy because right now, we aren’t talking about those “Unicorns”. Here, we are referring to the Unicorns of the Business World that have made their mark and shown the path to the economy of the country through new innovations and business ideas.
Privately held startup companies with a value of over $1 billion are called Unicorns; a term commonly used in the venture capital business. They require innovation and tend to be private investors or venture capitalists. This term was first coined by Venture Capitalist Aileen Lee in 2013 and is still in use with over a 1000 Unicorn companies worldwide as of March 2022.
Achieving the status of a Unicorn is not any business’ cup of tea. It takes a lot into consideration such as an innovative idea, a clear vision for growth, a solid business plan and most importantly, a remarkable way to impress investors and venture capitalists. Way back in the 2000s, only 0.007 businesses were able to acquire $1 billion due to which, Aileen Lee compared accomplishing this feat to finding a mythical unicorn.
At the beginning of 2020, the average time to become a unicorn was estimated to be 9.8 years. However, with 2021 producing the highest number of unicorns and with 2022 adding 13 more to the list, the average time has now been reduced to 6.8 years. Interestingly, 33 companies in India have achieved this status in less than 5 years and Mensa Brands holds the record for becoming a Unicorn in just 6 months!
Indian startups raised over $42 billion the previous year, which was also the year of most exits, Mergers and Acquisitions (M&A), as well as Initial Public Offers (IPO). About 11 IPOs acquired over $7.3 billion, including the Indian Software Company. Moreover, Freshworks became the first company to get listed on Nasdaq after Infosys. Reaching a valuation of $340.79 billion, India ranks 3rd with 107 unicorns, just behind the US (487) and China (301).
Bengaluru, the IT Capital of India has an estimated 39 unicorns. Receiving 51% of the total inbound capital in 2021, it has now emerged as the 7th largest unicorn club of the world. Apart from that, there are 32 unicorns in Delhi- NCR and 16 in Mumbai. Interestingly, rest of the cities in India are also seeing the rise of startups as Chennai and Pune host 6 unicorns each and Hyderabad (2) with the latest inclusion of Car Dekho in Jaipur in 2021.
Physics Wallah, the latest Unicorn in India has been around the corner for a while and is also gaining a lot of coverage. Started in 2014 by CEO Alakh Pandey as a YouTube channel to provide education to students from all backgrounds, it has now emerged as a revolutionary idea that recently went through Series A funding and received $100 million from Wesbridge Capital and GSV Ventures. This eventually made them reach $1.1 billion post-funding and thus the story of Physics Wallah was scripted from a mere youtube channel to a unicorn.
India’s entrepreneur journey is worth a case study which shows how from a predominantly labour-rich country, we are now home to over 66000 startups and more than 100 unicorns. From providing door step delivery of groceries and medicines to rendering essential services like online education and doctor consulting, these startups have played a major role in helping citizens during the pandemic. Unlike other companies, these unicorns stood by their employees and supported them fully in tough times.
It is such a remarkable achievement of our country to have businesses growing and prospering in the era of startups and digitalization. With a target of crossing 1 lakh startups by 2025 and 200 unicorns by 2023, the future of our country seems very bright, considering the amount of skill set that India now has. This is something that no Indian could ever have imagined! Hopefully, we’ll get to see India as the Startup capital of the world.