Legends describe unicorns as these mythical creatures with magical powers that are notoriously difficult to find and capture. Nonetheless, we all had daydreams of finding one as a child and bringing it home with us. You would expect that, as adults, our unicorn chasing days are over. Although that might be true regarding the hunt for a one-horned horse, elite investors in Silicon Valley are in hot pursuit of a new kind of unicorn. These new unicorns are companies that typically haven’t IPO’d yet, but are worth over $1 billion. Because of their high valuations and pre-IPO status, they are just as magical for investors as their mythical namesakes. And just like ‘real’ unicorns, there aren’t many of them around, and they’re notoriously hard to find. Companies like Amazon, Facebook, Tumblr, Zulily, YouTube and LinkedIn are all considered unicorns.
Most unicorns typically get a large part of their startup funding from established individuals who aren’t expecting a return on their investment in the short term and have other income streams to sustain them. This takes some of the pressure off when it comes to monetization and allows the startups to focus on their technology and execution. These investors are really looking at their stable of prospective unicorns as long-term lottery tickets. In other words, slim chances for success, but massive payouts when they hit it big.
Here are some of the hottest unicorns out there today:
Chances are you’ve ridden on this particular unicorn at some point in the four years since it came out. The Uber app connects independent drivers with people looking for rides to pretty much anywhere. With features like integrated payment methods and live driver maps, it’s become the 2nd biggest silicon valley unicorn next to Facebook. Uber has rocketed to a $50 billion valuation with Travis Kalanick (CEO) at the helm. That’s higher that the majority of the S&P 500! In fact, Uber has grown exponentially faster than even Facebook did in the short time it has been in existence. Uber is currently available in 40 countries and counting with about $11 billion in revenue from the US alone.
Ever sent a text or picture you wish you could take back? Avoiding these potentially embarrassing momentos are what Snapchat is all about. This app features a built-in expiration mechanism that leaves no trace of your content on the recipient’s device a few seconds after they open it. Founded by Evan Spiegel alongside Bobby Murphy in 2012, Snapchat is currently valued at $15 Billion. Speigel found himself in a race with Facebook’s Mark Zuckerberg after it was revealed that they were also planning to release a similar app. Despite the Facebook brand advantage, Snapchat managed to dominate the space. Lightspeed Ventures, who put up $485,000 at a $4.25 million valuation, was an early supporter of the company, and they’re smiling all the way to the bank as Snapchat continues to grow in popularity.
It’s hard to spend a minute online without running into a ‘pin’ from this app, which is a visual bookmarking tool allowing users to share their eye for style with the world. Pinterest is yet another silicon valley startup that has astounded everyone with how quickly it has grown. It’s currently valued at $11 billion, which is about double what it was just one year ago. Since it was founded in 2010, Pinterest has grown to over 500 employees with offices around the world in major international style havens like London, Tokyo, and Paris.