User:Aad29/Unicorn (finance)

Investing in Tech Industry
A few investors avoid the tech industry because they view it as irrational and impenetrable in nature. In reality, the tech industry has robust investment opportunities with high innovation and invention. Companies in this industry invest heavily in Research and Development. The competition in this industry is fierce leading to more innovation and giving a steady stream of new and improved products. The tech industry has four main sectors - Semiconductors, software, networking and internet, and hardware. Tech stocks have higher premiums and are high growth investments. The investor should understand the technology and its rivals before investing. Around 0.07% of the startups reach the $1 billion valuation.

History
Aileen Lee, founder of CowboyVC, first coined the term "Unicorn" to describe a privately held company with a valuation of over $1 billion. Airbnb, Epic games, Robinhood and SoFi are some of the most popular Unicorns right now. She first mentioned the word "Unicorn" in her article where she researched and analyzed tech startups that were found in early 2000s. She noted that finding one is as rare as finding a mythical Unicorn. Around 0.07% of the startups reach the $1 billion valuation. The first tech unicorns were found in the 1990s, with Alphabet and then Google reaching $100 billion. Many unicorns were born in 2000s, but Facebook is the only super Unicorn in that list. Today, the term is widely used in the mobile technology and information technology sectors.

Features of a Unicorn Startup
Every Unicorn has its success story. All of them have features that have led to the $1 billion valuation. Most of the Unicorns have brought disruption in the field they belong to. For example, Airbnb has changed the way people stay while travelling. Uber has revolutionized the way people travel. These Unicorns have led to significant changes in the everyday lives of the people. A common pattern that is observed in most Unicorns are the fact that they are mostly starters in their industry. They benefit from First mover advantage, gaining competitive advantage in the market they belong to. These companies have been able to establish a strong brand recognition and customer loyalty. Lastly, all the Unicorns have been able to use tech as their business model. 87% of the Unicorn products are software, 7% are hardware and the rest are other products and services.

62% of the Unicorns are B2C, with their aim being making life easy for their consumers. They make their products affordable to gain a higher market share. Unicorns are privately owned, which means that they are not regulated by difference agencies. This makes them highly profitable and have a high growth potential.