Internet and e-commerce: сompanies that have become unicorns in the last year
On March 11, 2020, the World Health Organization made the assessment that covid-19 could be characterized as a pandemic. Economic life, however, did not stop. The need for new goods and services, quarantine measures — these and other factors pushed businesses to rethink their activities. Many have found niches for growth in the face of constraints, which has once again confirmed the most famous business statement: the crisis is a time for opportunities.
Experts and analysts have been talking about the expected boom in IT almost since the first days of the pandemic. The transition of the whole world to the “online” mode, distance learning and work, closing of physical shops, round-the-clock staying of millions of people at their homes — these and other challenges faced the developers and innovators. A few months after the spread of the coronavirus disease, tech giants Facebook, Amazon, Google and Apple added a total of $230 billion to their market value, and did not stop on that.
Not only well-known IT brands grew.
Many years ago, introducing the term “unicorn”, the founder and managing partner of the American investment company Cowboy Ventures Aileen Lee, sought to demonstrate the uniqueness of such successful cases in IT: then there were only 39 billionaires, companies and startups. However, in the following years, the industry showed rapid growth. At the time of writing this article, there were already 642 unicorns on the CB Insights list, with a total value of $2.1 trillion.
Almost every day, new players join this elite club of billionaire companies, and sometimes more than one. What startups popped up during the pandemic, are there some strong trends — we tried to analyze.
Internet software & services
The segment of Internet solutions showed the largest surge since the beginning of the pandemic: 42 new unicorns compared to 16 in the same period 2019-2020.
This segment includes a variety of software and services designed for the network:
- ClickUp — an application to increase personal productivity;
- monday.com — a web tool for project and team management;
- Patreon is a well-known financial support service for creative people and independent projects, the value of which reached $4 billion in Sep 2020.
The boom of financial startups in the world began long before the pandemic, and with its onset not only did not weaken but also intensified. Thus, from March 11, 2020 to March 31, 2021, 38 new FinTech unicorns appeared in the world, a year earlier — 28.
Among the newcomers is the well-known British cryptocurrency wallet and cryptocurrency exchange Blockchain.com. Israeli startup Melio, meanwhile, lets users pay vendors by bank transfer or credit/debit card, even if vendors only accept a check. Digit Insurance from India focuses on car, travel, mobile, jewellery and bicycle insurance.
By 2022, FinTech is expected to grow by 25% annually, reaching a market value of $309 billion.
Finally, over the past year, there has been significant growth in e-commerce and all the solutions that link the seller to the buyer (so-called direct-to-consumer). During the period under review, 25 new companies and startups of this segment were added to the list of unicorns. A year earlier, there were only 12 such companies.
In this segment, you can find marketplaces for vintage sneakers sales, and new clothing brands, and services for the delivery of food from the store to the buyer and even platforms for construction materials sales.
“Thus, in the future, instead of buying bananas in a grocery store, you could go pick them off a tree in a virtual jungle,” — Yasuhiro Fukushima, one of the founders of the Japanese computer game company Enix Corporation
MedTech, EdTech and outsiders
Many people expected healthcare startups and companies to grow rapidly in the pandemic. This sector really raised almost three times — 19 new unicorns compared to seven in the same period 2019-2020. However, against the other leading segments, the number of new billionaires in MedTech was slightly smaller.
These include applications to help users find doctors and clinics, e-psychologists, personalized health assistants, programs to overcome specific diseases (diabetes, back pain), solutions that simplify access to health care etc.
Only four new unicorns have appeared in the EdTech field, although the industry rarely produces billionaires. But there is, for example, the Canadian platform with artificial intelligence ApplyBoard, which helps international students to apply for education in North American schools. And the Chinese company Yunxuetang, which helps businesses, educational institutions and third party users develop and operate online classes.
In 2020, there were no unicorn startups in the travel segment. The logistics and supply chain industry suffered also, as well as the automotive and transportation. However, the trends in the vibrant list of unicorn companies clearly reflect the mood prevailing in the world and among businesses during the covid-19 crisis outbreak.