Unicorns: What Billion Dollar Startups Have in Common George February 6, 2014 Billion Dollar Apps, Research It always pay to learn from the best, the most successful companies. There is, after all, not much point trying to learn from the average and mediocre. Especially if you’re time poor, like most of us these days. Aileen Lee from Cowboy Ventures (what a great company name) authored a pretty great piece on Techcrunch. Her investment firm compiled a great report about all the billion-dollar startups in the last decade, and surfaced some super interesting facts. Here are some of the key takeaways from the article: 39 companies belong to the “Unicorn Club” (definition: U.S.-based software companies started since 2003 and valued at over $1 billion by public or private market investors). Only 4 Seven of the companies are mobile-first (Instagram, Waze, Uber, Square, Rovio (Angry Birds), Supercell (Clash of Clans, Hay Day), King.com (Candy Crush Saga). Not surprising, the iPhone was only launched in 2007 and the first Android device in 2008. Consumer-oriented unicorns have been more plentiful and created more value in aggregate, even excluding Facebook. But enterprise-oriented unicorns have become worth more on average, and raised much less private capital, delivering a higher return on private investment. Companies fall somewhat evenly into four major business models: consumer e-commerce, consumer audience, software-as-a-service, and enterprise software. On average, four unicorns were born per year in the past decade, with Facebook being the breakout “super-unicorn” (worth >$100 billion). In each recent decade, 1-3 super unicorns have been born. It has taken 7+ years on average before a “liquidity event” for companies, not including the third of our list that is still private. It’s a long journey beyond vesting periods. Inexperienced, twentysomething founders were an outlier. Companies with well-educated, thirtysomething co-founders who have history together have built the most successes The “big pivot” after starting with a different initial product is an outlier. San Francisco (not the Valley) now reigns as the home of unicorns. If you’re interested in reading more, head on over to the article on Techcrunch. I will be following up in a post to distill how this applies to billion dollar apps specifically.