Unicorn Elements 

  • What is a unicorn?
    Unicorn is a term used in the venture capital industry to describe a privately held startup company with a value of over $1 billion.
  • What triggered the unicorn rush during 2021?
    While work from home during the pandemic fueled the growth of digital businesses in India, the incident also resulted in a long unicorn list. Mainly three factors, a thriving digital payments ecosystem, large smartphone user base and digital-first business models, have come together to attract investors. Tech companies, which have become household brands, are contributing to the unicorn boom in India, as smartphone penetration and digitization of commerce in every aspect of life has increased manifold during the pandemic. Besides fintech, e-commerce grocery, SaaS and marketplace players are contributing the most to the unicorn universe.
     
 

Unicorns Of India 

As of 05th May 2022, India is home to 100 unicorns with a total valuation of $ 332.7 Bn.  

The year 2021, 2020, and 2019 saw the birth of the maximum number of Indian unicorns with 44, 11, and 7 unicorns coming each year, respectively. COVID-19 has caused a great amount of socio-economic suffering globally, but it is during this time when the resilient Indian Entrepreneurs have worked effortlessly to not only contribute to the economy but to also contribute toward COVID-19 relief efforts. In 2020, we witnessed the birth of more than 10 unicorns. ‘Its raining unicorn’ has been the motto of the year 2021 with 44 unicorns pumped in the ecosystem and many soonicorns waiting in line.  

Geographically, the center of India's high-tech industry, Bengaluru is India’s unicorn capital with the largest number of unicorns headquarters followed by Delhi (NCR) and Mumbai. While we see unicorns active in Tier I cities, this ecosystem is not restricted and is proliferating across the country till the last district. Traditional sectors such as E-commerce, Fin-tech, E-commerce, Supply Chain & Logistics, Internet Software & Services do dominate the arena but a strong wave of unconventional sectors such as Content, Gaming, Hospitality, Data management & analytics, etc are making their place on the list. 

While every startup has its unique journey to becoming a unicorn, the minimum and maximum time taken by a startup to become a unicorn are 6 months and 26 years, respectively. Mensa Brands took only 6 months to become a unicorn in 2021, making it one of fastest unicorns in Asia.   

Indian Startups turned Unicorns in 2021

In 2021 itself, India witnessed the birth of 44 unicorns with a total valuation of $ 93 Bn. Bengaluru, Delhi NCR, and Mumbai continue to be the top cities preferred as unicorn headquarters in 2021. Unconventional sectors and sub-sectors marked an entry into the unicorn space including, NBFCs, Conversational Messaging, Cryptocurrency Exchanges, D2C, Cloud Kitchens and many others.

Indian unicorns are also exploring the public listing avenues as a next step to realise the growth potential. Some one of big unicorn names that offered an IPO include Zomato, Nykaa, PolicyBazaar, Paytm and Freshworks, while many are already in line such as Delhivery, Mobikwik and CarDekho. 

Today, 1 out every 10 unicorns globally have been born in India. Overall, 2021 is experienced an exponential boom when it comes to startups entering the unicorn club. This is a testament to the vibrant startup ecosystem present in India.

Till date, 2022 has witnessed the birth of 14 unicorns with a total valuation of $ 18.9 Bn (as of 05th May 2022). 

 

Investors in Unicorns

The robust nature of the Indian startup ecosystem is evident in 2022 year-to-date when as per a YourStory Report2, in Q1 2022 with 482 funding deals were recorded, 89% higher in comparison to Q1 2021 (255 deals). Over $ 10 Bn funding was raised by startups, 2.7x of funding raised in Q1 2021 ($ 3.7 Bn). Sequoia Capital India has been the most active investor, followed by Kunal Shah (Founder, CRED), Tiger Global Management, Accel, Alpha Wave Global, and Trifecta Capital.  

Additionally, there also has been a shift in the traditional way of funding, wherein startups are now looking at exercising alternate routes such as crowdfunding, revenue-based financing, venture debt, bank loans, etc. Startups such as Zerodha, which have been bootstrapping since inception are changing the unicorn funding norms and promoting independence and revenue generation since the early stages. Since the onset of COVID-19, an unconventional trend observed is the new entries to the unicorn club without any billion-dollar ticket size investment.

 

Unicorn Sector Snaps 

  • Healthcare

    1
    • The HealthTech market in India is estimated reach $ 5 Bn by 2023, growing at a CAGR of 39% post the pandemic impact. Digital shift, use of better technology, and favourable government policies are facilitating the growth of the market.
    • Noida-based healthtech startup Innovaccer has become the first Indian unicorn in the healthcare sector currently valued at $ 1.3 Bn. Innovaccer analyses healthcare data to provide actionable insights to healthcare providers, hospitals, insurance companies and other organisations and businesses.
    • Earlier this year, Pharmeasy, an online pharmacy and diagnostics brand, became a unicorn, bagging a valuation close to $ 1.5 Bn. The online pharmacy is now planning to go public soon, eyeing a valuation of about $ 7 Bn through its IPO.
    • Cure.fit and Pristyn Care have joined the unicorn club bringing the total number of Healthcare unicorns to 4 with a total valuation of $ 11.7 Bn 
    • The heathcare segment in India is soon to see added number of unicorns with the growth of health-tech startups such as Practo, HealthifyMe etc. 
  • Social Commerce 

    2
    • Social commerce startups in India have generated revenue worth of $554 million as of July 2021, a 7x increase from last year and the highest ever since 2015.
    • Social commerce has made it possible to unlock tier 2 and tier 3 markets and reach low-margin categories in fast-moving consumer goods and groceries, which large e-commerce platforms have not done so far, helping boost the overall e-commerce industry, experts and investors who view the sector as an extension of e-commerce.
    • Meesho, backed by Facebook, has become the first Indian social commerce startup to enter the unicorn club valued at $ 2.1 Bn. Meesho is an online reseller network for individuals and small and medium businesses (SMBs), who sell products within their network on social channels such as WhatsApp, Facebook, and Instagram. It has about 13 Mn individual entrepreneurs, bringing the ecommerce benefits to 45 Mn customers pan India. Meesho claims to have delivered orders from more than 100K registered suppliers to over 26K pin codes across 4,800 cities, generating over INR 500 Cr ($68 Mn at current conversion rate) in income for individual entrepreneurs
    • The social commerce segment in India is fast growing, with companies like SimSim, GlowRoad, CityMall and Bulbul also in the unicorn race, getting attention from both customers and investors.

     

Next Stage: Going Beyond the Unicorn 

The global startup ecosystem is witnessing a shift as the world is increasingly realising the potential carried by the startups. We are gradually transitioning from the age of unicorns to the age of decacorns.

A decacorn is company that has attained a valuation of more than $ 10 Bn.

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 decacorn cohort.

 
 

2022

  • Amagi Media Labs

  • Cred

  • darwin

  • DealShare

  • ElasticRun: https://www.elastic.run/

  • fractal ai

  • games24x7.com

  • Hasura

  • https://leadschool.in/

  • LivSpace: https://www.livspace.com/in

  • Open

  • OXYZO

  • Uniphone

  • Xpressbee

2021

  • Blinkit

  • Cure Fit

  • Easemytrip

  • Global Bee

  • Good Glam Group

  • Mamaearth

  • Mapmyindia

  • Mobikwik

  • Pristyn Care

2020

  • Ze

2019

2018

2017

  • Renew

2016

2015

2014

2013

2012

2011

Others

  • Info
  • Makemytrip
  • Zoho

Source: Inc42 as of 5th May 2022