Unicorns in India

Unicorns in India

Subject :Economy

Section: Economy

Context:

India ranks third in the number of unicorns created, according to the latest Hurun Global Unicorn Index.

Details:

• The US tops the list, with 138 start-ups, achieving a valuation of $1 billion in the same period.
• India has created the second-highest number of unicorns – 14 – in the first half of 2022.
  • India consolidated its Top 3 spot with 68 unicorns in India  and in total 124 unicorns founded by Indians around the world
  • Bengaluru accounts for 2.5 percent of the world’s unicorns.
• China created just 10 new unicorns in the first half of 2022, despite having the second highest number of unicorns globally.
• Cities with the most unicorns–San Francisco 176 (World Unicorn Capital)> New York 120> Beijing 90> Shanghai 69> London 39> Bengaluru and Shenzhen with 33 unicorns each.

What is a Unicorn?

• Unicorns are privately held, venture-capital backed startups that have reached a value of $1 billion.
• Features:
  • Disruptive innovation: Mostly, all the unicorns have brought a disruption in the field they belong to, for example, Uber transformed commuting.
  • Technology-driven: The business model is driven by the latest technological innovations and trends.
  • Consumer-focused:  Their goal is to simplify things for consumers and be a part of their day-to-day life.
  • Affordability: Keeping things affordable is another key highlight of these startups.
  • Privately owned: Most of the unicorns are privately owned which gets their valuation bigger when an established company invests in it.
  • Software-based: A recent report suggests that 87% of the unicorns’ products are software, 7% are hardware and the rest 6% are other products & services.
• The valuation of unicorns is not expressly linked to their current financial performance, but largely based on their growth potential as perceived by investors and venture capitalists who have taken part in various funding rounds.
• The average annual growth rate of Indian unicorns is more than that of the U.S., the U.K. and many other countries.
• American venture capitalist Aileen Lee is credited with coining the term in 2013. It was used to emphasize the rarity of the emergence of such startups.
• A decacorn is a company that has attained a valuation of more than USD10 billion.
  • As of May 2022, 47 companies world over have achieved the decacorn status.
  • India has four startups namely, Flipkart, BYJU’s, Nykaa and Swiggy, added in the decacorn cohort.