Despite the economic impact resulting from the coronavirus pandemic, the number of companies attaining unicorn status, or a billion-dollar valuation, has hit historical levels, backed by factors like increased funding.
Data acquired by the financial news portal Finbold indicates that the number of new global unicorns has spiked 491% between Q2 2020 and Q2 2021, from 23 a year ago to a staggering 136 in the second quarter this year.
During the first quarter of this year, the figure stood at 113 companies, representing a growth of 140.4% from 2020 Q4’s 47 unicorns. During the first quarter of 2020, the number of unicorns had dropped to 21 from the previous quarter’s figure of 31.
Between Q2 2016 and the second quarter of this year, the number of companies to attain a billion-dollar valuation grew by 871%. Throughout this five-year period, the smallest number of unicorns was recorded in Q4 2016 at 10.
Companies utilise pandemic
The companies attained unicorn status amid the coronavirus pandemic that also offered a perfect opportunity to increase in valuation.
“Most of the unicorns that emerged amid the pandemic capitalised on the newfound urgency of online integrations,” said the research report.
“In general, the pandemic has accelerated the adoption of online technologies. However, the companies had already recognised the need to shift online before the health crisis ushered in clients and investors.”
With the valuation, the companies are now focusing on sustainability to make profits, the Finbold research showed.
Furthermore, with the most promising startups recording an increase in venture capital funding, most companies should continue to attain unicorn status in the future.