Yup, you read that right! Unicorns are no longer a myth — at least not in business.
These billion-dollar startups exist and are playing a whole different league. But while others lived up to the hype, some are struggling to maintain relevance in the nine-figure game.
So what makes all the difference? Who owns the unicorn game, and what can we learn from them? In this blog, discover the top unicorns in the playing field today and the business models plus tactics that keep them there.
Insight: It's not enough to become a unicorn. Businesses also need to consider how to stay one.
Data: The number of unicorns has surged drastically in recent years, with an average of 43 companies joining the billion-dollar club each month, but it is facing a decline post-2021. (WIPO)
What's the step change: Learn and adopt the tactics, structures and business models behind the world's biggest players to scale your challenger business.
First coined by Aileen Lee — “Unicorn” has since become a buzzword in business, especially in the world of startups.
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Unicorns or Unicorn Companies were originally defined as “US-based software companies that started in 2003 and valued at over $1 billion by public or private market investors”. Now, they’re known as “venture-backed private companies valued at $1 billion or more”. |
So, what makes these companies so valuable?
A couple of key distinctions would be their business models, which allow them to build a brand without spending on extravagant TV ads.
But let’s go back to the basics.
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A business model answers the key question, “How do you plan on generating revenue and profit for your business?”
It helps you define your customer value proposition and pricing. By nailing your structure and business model, you get to organise your business, connect with partners to generate revenue, and manage your supply chain accordingly.
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A company without a business model is like an apple with no core. No company can look to the future without a strong sense of purpose and a defining sense of self.
In the world of unicorns, certain business models thrive more than others such as:
Some unicorn companies use a certain kind of business model that stakeholders and investors prefer. So it’s important to keep your finger on the pulse and see whether the trends on your radar are worth adopting or leveraging.
1. Be a Purpose-Led Organisation
Highly scalable organisations are driven by purpose.
When you know exactly what it is you do and why you do it, you get through almost anything. Craft a crystal clear purpose, set of beliefs, and mission to guide your mission and inspire your team.
This provides stability on both short and long-term goals from strategy to decision-making and execution.
2. Form a Team of Founders
A majority of the unicorns are run by a team of cofounders.
Often, these cofounders have met each other from previous work experiences or used to be college buddies. If you want to build your own superstar team, consider getting a visionary, an expert on user experience, an expert on business/finance, and an engineer.
By bringing these players together, you create a dynamic and powerful mix of skills and backgrounds in your team.
3. Build the Minimum Viable Product
Key factors why startups fail is the timing of their offer or there was no market need for them in the first place.
When launching new products, some startups make the mistake of diving into the market head on and without a plan. They assume people will be interested in what products they have to offer right away.
Without a thorough market study, you’ll never know for sure if your products will gain traction, and even attract the right people consistently enough to generate revenue.
First, you need to do is determine the smallest feature footprint that would allow you to get your product to early adopters. Then, gather user feedback until you hit the sweet spot.
With this data, you can make the necessary product modifications before setting out to market it again. This is what building your MVP (minimum viable product) looks like — it is a process of developing your product until you’re confident you have the right set of features to ‘wow’ your customers and address their needs.
4. Revisit Your Business Model
Startups become unicorns because their business models offer a disruptive alternative to the status quo. So, they’re always on the lookout for innovative ways to deliver value — even if it means exploring what seems like uncharted territory.
You’ll know it’s time to revisit your business model when:
Contrary to popular belief, filing for bankruptcy does not always come from shady practices or having clients who fail to pay their invoices. Sometimes, it’s because business leaders fail to anticipate and respond to industry disruptions or changes promptly and proactively.
5. Put Customers at the Heart of Everything
Unicorns know the magic lies in customer satisfaction.
It's not just about selling a product but truly understanding their needs. Actively listen to their feedback, pay attention to their preferences, and tailor your offerings to meet their needs.
Creating an extraordinary customer experience More than strategy, extraordinary customer experiences are a commitment to building lasting relationships. Remember, your customers aren't just patrons. They are cherished partners in your journey to success.
6. Guard Your Users' Info Like a Pro
In the age of the digital revolution, caring for your users' information is a non-negotiable.
Go beyond basic security measures by investing in top-notch cybersecurity and privacy protocols. Being a pro at safeguarding user information isn't just about protection. It's a strategic move.This builds trust within you and your users while giving you valuable insights on how to deliver value.
You may think that the chances of becoming the next unicorn seem improbable, but billion-dollar unicorns are a goldmine of lessons on building a highly scalable business.
Unleashing strategic agility, these unicorns teach us to dance with disruption, drawing inspiration from their ingenious business models.
As challenger brands, there’s value in embracing unicorn tactics — from being purpose-driven to teaming up dynamically, creating MVPs, and staying nimble with adaptable models. The unicorn secret? Be ready for disruption, protect your customers, and make your customers feel like cherished pals, not just buyers on a journey to success.
Download our Unicorns Revisited PDF!
Featuring the top unicorns in the game, their business models, and every unicorn's key tactics in their arsenal, you now have a handy guide to scale your challenger business.
Photo by Rohan Makhecha on Unsplash