Unicorn Startups are just as majestic, glorious, and powerful as they sound. For any startup founder, it is a dream come true and a badge of honor to have been declared a Unicorn as their valuation soars above $1 Billion.
As of 2022, there are only 554 Unicorn Companies globally, with Bytedance – a company from China, coming on top with a valuation of $140 Billion. As one can expect, reaching a $1 Billion valuation isn’t easy and the probability of any startup reaching that point is relatively low.
So, how do these startups become Unicorn companies? Learn the 5 characteristics of a Unicorn startup in this article.
1. Bringing In Disruptive Innovation
Look at the pattern – they tell a lot about how a company should function. The past unicorn companies have brought a wave of disruption to the market. For example, SpaceX, the company that changed the term ‘Space Exploration’ and has given the dream of colonization of Mars to thousands of people all around the globe is a Unicorn Company valued at $100.3 Billion. The company has not just changed the concept of living in space but has also shown the future with multi-planetary living. Talk about crazy.
Innovating something that can help bring a change in the existing market and to be able to disrupt the market can help you take that step towards being a Unicorn Company. Prioritize your company’s primary mission, beliefs, and culture. Your business concept must generate a profit from day one while also meeting the needs of your customers.
Your innovation strategies will help you have a strong base in the market and disrupt the market in a way that would make you more powerful.
2. Being The First Mover
Starting a business can be exhausting but can also give you a lot in return. When you become the first to introduce something in the market, you automatically get an advantage. As you become the first one in the market, you get a competitive advantage, product offering, and infrastructure.
Being the first in the market will help you change the behavior patterns of people and the way they consume products. The target audience perceives the brand to be robust and loyal. First movers in the market are also considered to innovate to remain ahead of potential competitors. The Unicorn Companies are often startups in their respective industries. They alter people’s behavior and eventually establish themselves as a need. They are also recognized for constantly innovating and staying ahead of the competition, eventually becoming successful.
Taking the giant leap and a bold move to be the first in the market will someday help you be a unicorn company.
3. Having A Viable Business Model
Most of the time, businesses start with hope and aspirations and big promises to bring in disruption but not with a lot of viability. Having a viable business model means that your product is clearly defined and scalable, along with having a defined market with customers who want and need your product and can help you grow. A viable business model will give you some form of competitive advantage along with helping you make a profit. A viable firm is profitable, which indicates that it generates more income than it spends on operating expenses. It’s difficult to recover a business that isn’t profitable. The company would have to either raise revenue, cut costs, or both.
The scalability of any business determines how long the company will last. When you can scale your business and cover more market ground, your business will grow, giving you more visibility and eventually more and more valuation. In addition, scaling your business will provide you with the edge of earning more revenue and more profit, increasing company valuation.
Making sure that your product solves a real problem, identifying primary customers, developing a solid value proposition, and reviewing and revising your business model will only help you and your company everywhere and, most importantly, be a Unicorn Company.
4. Being Customer Focused
The main goal for any company is to cater to the needs and wants of the people and generate revenue and profit through it. More than 60% of Unicorn Companies are B2C companies – business-to-consumer companies. Their goal is to make things simple for customers and become a part of their daily lives. Another significant feature of these businesses is that they keep items affordable and have different choices.
Taking the example of Airbnb, the company gives their customers choices through which they can choose a place that they can comfortably afford. Being focused on the customers and being able to analyze all of their needs will help your business scale, cover more markets, along with being able to generate more revenue.
Focusing on customer experience will help your business keep loyal and lifelong customers and build brand value. However, being on the road to becoming a Unicorn Company means that you need to be invested in your customers.
5. Embracing New-Age Technologies
The world is changing into a more prominent, better place as businesses opt for and embrace different kinds of technology. One thing familiar with Unicorn Companies is that their business models run on technology. Therefore, it is crucial to adapt to the changing market and technologies.
The majority of unicorn businesses have a technologically advanced business plan. Almost 87 percent of unicorn products are software, 7% are hardware, and 6% are focused on products and services. For example, Uber became the big thing as they have crafted a friendly app, Airbnb has one of the most user-friendly websites, Grammarly is easy to use and can be extended to any browser and docs.
Embracing high tech is the new way to go. Not just in terms of software but also in FinTech, CRM, System Intelligence, and many more.
Unicorn is not just a word; it is an identity. It is a long way to go, and not all startups can become Unicorn Companies, but that said, new businesses must not stop their hustle and keep going forward. New things are always coming up every single time. You blink your eyes, and someone has innovated and brought in a new product. The hustle and bustle keep going on and on no matter what.
Finding the appropriate people and developing a valuable product are essential aspects of becoming a Unicorn. It is unique among existing solutions, but no other product can provide the same level of service.