While there is much activity in the rapidly expanding world of unicorns in India, only some understand the meaning of unicorn startup and how it connects to the expansion of a startup business. We routinely discuss unicorns such as Uber, Airbnb, Snapchat, and Pinterest, but we rarely define a unicorn.
Have you ever wondered why certain companies were given certain names? What prerequisites are necessary for this position? Or you may have only thought about how to become a unicorn. In that case, you should read this guide. Continue reading to discover all about unicorns!
What is a unicorn in startups?
In the venture capital industry, a unicorn is any startup with a valuation of at least $1 billion.
Aileen Lee, the founder of Cowboy ventures, created the term “unicorn” when she referred to 39 businesses with a valuation of over $1 billion as “unicorns.” Initially, the word was employed to emphasize the rarity of such enterprises. Since then, the definition of a unicorn startup has stayed unaltered. Nonetheless, the number of unicorns has increased.
Characteristics of a unicorn startup
Being a unicorn is not easy, and each unicorn today has its unique story with a list of advantageous characteristics. We have compiled a list of characteristics that are shared by all unicorns:
Innovative disruption:
Most unicorns have introduced disruption to the field to which they belong. For instance, Uber altered how people commute. Airbnb altered how consumers booked their travel accommodations, while Snapchat affected social media usage.
The initials:
It is observed that unicorns are typically industry pioneers. They gradually create a necessity for themselves by altering people’s behaviors. They are also viewed as maintaining innovation to remain ahead of competitors who may later flourish.
Highly advanced:
A second universal characteristic of unicorns is that their business models rely on technology. Uber’s business model was adopted by creating a user-friendly app. Airbnb made the world appear more manageable by maximizing the Internet. According to a recent report, 87% of unicorn goods are software, 7% are hardware, and 6% are other products and services.
Consumer-focused:
62% of unicorns are B2C businesses. Their mission is to make consumers’ lives simpler and more convenient and to be an integral part of their daily lives. The cost-effectiveness of their products and services is another hallmark of these firms. For instance, Spotify made listening to music easier for the entire world.
Personally owned:
Most unicorns are privately owned, which increases their value when an established firm invests in them.
How do startups become unicorns?
Unicorn startups are highly regarded in the business world, and rightly so. To qualify as a unicorn startup, a firm must attain a valuation of at least $1 billion, and as of 2023, there are only 554 unicorns on the globe. In the first week of 2021, fintech business Divvy, analytics startup Starburst, and sales engagement platform Salesloft joined the unicorn club.
Obtaining unicorn status is possible, but it can be extremely tough. In reality, a company has a 0.00006% chance of becoming a unicorn, and it takes an average of seven years for companies to mature into unicorns.
Nevertheless, some startups defy the odds. How do they manage? In this unicorn startup checklist, we will discuss the common qualities and techniques of successful unicorns so that you might emulate their success.
Which is the fastest startup to become a unicorn?
Obtaining unicorn status (a valuation of $1 billion) is exceptional for any startup. Nonetheless, it is a challenging task. It is exceedingly challenging to design a unique product or service, assemble a purpose-driven team, obtain financial backing, attract customers, and, most importantly, scale up. Meanwhile, there are unique Indian businesses that make it appear so simple.
In its first six months of operation, Mensa Brands of Bengaluru became the quickest Indian startup to become a unicorn. A remarkable feat! This article illuminates the company’s strategy for altering brands across India and earning a profit in this interesting undertaking!
Mensa Brands’ Origin
In May 2021, Ananth Narayanan, former CEO of Myntra and co-founder of Medlife (an online healthcare platform), endeavored to start a new business— a “house of brands.” He observed that most early-stage firms and startups in India’s fashion and beauty industries could not implement the appropriate strategies for business expansion. Numerous brands collapsed because they could not promote their products, manage their inventories, or drive sales!
Narayanan believed he possessed the knowledge and connections necessary to scale brands and structure mergers and acquisition (M&A) deals. His four-year tenure at Myntra contributed to developing a business strategy involving partnerships with and investments in digital-first fashion, cosmetics, and some fast-moving consumer goods firms (FMCG). He contacted his friends and devised a plan of action. Thus, Mensa Brands was established!
What exactly does Mensa Brands do?
- Mensa investigates promising entrepreneurs and products in the fashion, beauty, and personal care industries. They would choose brands with robust revenue sources and a moderately expanding consumer base.
- It will then negotiate a deal or business plan with brands and acquire a controlling interest (>51%) in them.
- These brands’ initial teams or developers then collaborate with Mensa Brands to expand operations. Mensa will assist firms in managing and expanding their product offers throughout their official digital platforms and all key marketplaces.
- Mensa would lend brands its knowledge of inventory management, technology, e-commerce, supply chain management, and digital marketing.
- They support startups engaged in tech-driven product development by identifying a product desired by potential customers. Mensa will also assist these companies in launching a new product line based on their results.
Money & Investors
Mensa Brands raised $135 million at a valuation of approximately $1.2 billion in November 2021, making it the quickest Indian firm to achieve unicorn status! Tiger Global Management, Accel, Norwest Venture, and Falcon Edge Capital Partners are major equity investors who support the company. Mukesh Bansal (cult.fit) and Kunal Shah (Cred) invest in Mensa as angel investors. Over six rounds, Mensa Brands has raised $187 million (1,540 crores)!
Frequently Asked Questions (FAQs) :
Which country has highest unicorn startups?
As of November 2022, the United States had the most unicorns, or privately owned enterprises, with a valuation of at least one billion U.S. dollars.
How many unicorns do India have?
In India, a staggering 108 businesses have attained the title of a unicorn to date.
Which is India’s first unicorn startup?
InMobi was the first firm to achieve unicorn status in 2011, followed by Flipkart. The e-commerce sector has produced the most unicorns in India.
Conclusion
The term “unicorn” has come a long way from its origins as a mythical creature to become a common topic of conversation in business and finance. Today, unicorn enterprises have achieved recognition and established a market presence. Nevertheless, not every unicorn will necessarily become a successful startup. Any startup must continue to work hard after reaching a milestone.
This blog helps you connect the dots to carry out all you’ve been preparing!
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