What is a Unicorn Startup? | Indian Unicorn Startups

What is a Unicorn Startup?

Sometimes mythology makes the best reference in real life. An example of this is the Unicorn, which saw the best fit in the startup world, due to its rarity, alchemy, and mythicism. The term was first used and popularized by Aileen Lee, a venture entrepreneur and founder of CowboyVC – a seed-stage investment fund. A Unicorn is a privately held startup that is valued at $1 billion or more. Well, the concept of valuation has a certain amount of uncertainty residing in it. However, investments cannot be made without it. Its significance can be understood further by diving into the parameters considered to calculate the value of a company. 


Valuation is both art and science.

  • Lili Balfour, Founder of Atelier Advisors

science involves researching valuations for comparable companies whereas Art depends on questions such as – How strong is the team? How probable are the leads in the pipeline? How innovative is the technology? Most investors look at similar companies in the space. Comparison with their financials, funding rounds, and their valuations will add clarity.

Indian Unicorns

India is the third-largest startup ecosystem in the world having more than 9000 startups, said a NASSCOM report. “The Indian startup ecosystem is approaching escape velocity, and is setting itself up for a period of sustained growth,” it further said. There were surprising trends and highlights. While India has 30 tech unicorns today, 21 of these were created in 2018 and 2019, with Bangalore and Delhi-NCR housing over 75% of these firms. Mumbai and other cities account for 3 and 4 unicorns respectively. Some of the large unicorns since 2018 include food delivery firms Swiggy and Zomato, hoteling startup Oyo Rooms, payments firm PhonePe, and fantasy gaming startup Dream11.

It is predicted that India will have 75-100 unicorns by 2025, adding that while sectors like eCommerce and fintech saw the initial wave and the maximum number of unicorns, it has diversified since. Today, unicorns are coming up in spaces such as social networks, data analytics, logistics technology, and education, among others. Almost 60% of the unicorns took less than 5 years from first funding to unicorn status. More than 75% of them did it within 7.5 years – meaning larger companies are being built faster in India than ever before.

Capital Pools for Unicorn

The sector is also a huge determinant in how much capital a firm needs to become a unicorn. B2C-Indian firms need on an average $206 million to achieve a billion-dollar valuation, while B2B-Indian firms need $131 million to reach the same valuation, the report says. B2B Global firms need $97 million, the least of the lot. The last includes companies such as Freshworks, Billdesk, and Druva- now mostly US-based firms but which started in India. While the early unicorns, such as Flipkart and Ola, were consumer-facing and India-focused, emerging unicorns are showing different trends. Of the 30 unicorns the report cites, 17 are consumer and India facing. Six are business-to-business or enterprise-focused in India, while seven are B2B for global markets built from India.

Indian startups do not significantly rely on just some late stage investors to become unicorns. A deep capital pool is available, beyond the traditional heavyweights such as SoftBank, Alibaba, Tencent, Naspers and DST and Tiger Global. Others include Goldman Sachs, Hillhouse Capital, Premji Invest, Temasek, Steadview Capital and Warburg Pincus, among others.

Here is a table consisting of Indian Unicorns:

No  Name No of years taken to gain unicorn status Sector  Amount of funding raised Location Valuation
1 Ola Electric 2 Mobility $309M Bangalore $1.1B
2 Paytm mall 2 E-Commerce $817M Delhi $3B
3 Udaan 2 E-Commerce


$900M Bangalore $2.8B
4 Ola 4 Ride hailing $3.28B Bangalore $6B
5 Snapdeal 4 E-commerce $1.8B Delhi $6.5B
6 Hike 4 Messaging $261M Delhi $1.4B
7 Swiggy 4 Foodtech $1.62B Bangalore $3.5B
8 Shopclues 5 E-Commerce $249M Gurgaon $1.1B
9 Oyo 5 Budget Hotels $3.2B Gurgaon $10B
10 Druva software 5 Data Management $330M Pune/


11 Rivigo 5 Trucking $258M Gurgaon $1B
12 Paytm  5 Payments $3.54B Noida $16B
13 InMobi 7 Mobile Ads $221M Bangalore $1B
14 Quikr 7 Classifieds advertising $370M Bangalore $1.6B
15 Billdesk 8 Payments


$246M Mumbai $1.5B
16 Freshworks 8 SaaS $400M Chennai/

San Mateo

17 BigBasket 8 Online Groceries $879M Bangalore $1B
18 Delhivery 8 Logistics $781M Delhi $1.6B
19 Lenskart 9 Eyewear $435M Bangalore $1.5B
20 PolicyBazaar 10 Insurance Tech $513M Gurgaon $1B
21 Byjus 10 EdTech $1.47B Bangalore $8.2B
22 Zomato 10 Foodtech $3B Gurgaon $3B
23 Icertis 10 Contract 


$212M Pune/


24 Flipkart 11 E-Commerce $7.14B Bangalore $21B
25 Dream11 11 Gaming $100M Mumbai $1.1B
26 MuSigma 14 Data


$209M Bangalore $1.5B
27 Citius Tech 14 IT-Healthcare $112M Mumbai/


28 PineLabs 20 Merchant financing $357M Noida $1B

Source: NASSCOM, Crunchbase, Forbes, Economic Times, Yourstory, Tracxn, Venture Intelligence

Rapid growth of Unicorns

Oyo building global presence

Oyo, which is the world’s third largest hotel chain, has its presence over 800 cities in 24 countries, including the UK, US, India, China, Malaysia, Nepal, UAE, Indonesia, Saudi Arabia, the Philippines and Japan. It has also tapped the European market by acquiring @Leisure Group which is a vacation rental company. Europe’s vacation rental market is worth $18.6 billion, according to estimates, growing at between four and eight percent annually. 

Flipkart’s e-comm growth

The world’s biggest e-commerce deal was walmart paying $16 billion to acquire a 77 percent share of the Bangalore-based shopping site Flipkart. The company’s venture in the fashion market has been a growth factor. Flipkart acquired the fashion e-commerce platforms myntra and jabong. However, all the jabong users are being redirected to Myntra which shows the complete attention migrating towards Myntra, after witnessing many number of downloads. Foraying into the Electronic market was also one the drivers. 

Byjus signigicant growth

In March 2019, Byjus was the world’s most valued edtech company at $5.4 billion. Shah Rukh Khan is the brand ambassador for BYJU’S. Byju’s was the first venture in Asia to attract investment from the Chan–Zuckerberg Initiative. Its tutoring app, Byju’s, is now available in the U.S., the U.K., and Australia. In 2017, it acquired the online education business TutorVista from Pearson.  BYJU’S acquired Osmo, a US-based maker of educational games for children aged 3-8 years for $120 million.

Udaan’s less time consumption to achieving Unicorn status

Asked how their B2B e-commerce platform Udaan became a unicorn in just two years, founders Sujeet Kumar, Amod Malviya, and Vaibhav Gupta identified four factors: “(1) a large market gap that no one was attacking in a serious way, (2) a great team executing on a great product offering for this market, (3) the appetite that the small and medium-sized enterprises had to devour such a product offering, and (4) fantastic timing in terms of [tax and other regulatory] reforms.” 

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