A Startup Unicorn is a company which has passed the billion dollars mark of valuation. Based on CB Insights research on Startup Unicorns. Variants of Unicorns include a Decacorn, made of companies valued at over $10 billion. And a Hectocorn, made of companies valued at over $100 billion.
The top ten Startup Unicorns as of January 2019, comprise Bytedance, Uber, Didi Chuxing, WeWork, Lu.com, Airbnb, SpaceX, Palantir Technologies, Stripe and JUUL Labs. The US remains the country with the highest numbers of Unicorns, followed by China. The top five industries for Startup Unicorns comprise Fintech, Internet Software, and Services, E-commerce/marketplace, On-demand, Healthcare.
Classifying a business model isn’t a simple task, a business model is made of many moving parts. And creating a representation of a company on a single characteristic or feature is too reductive.
There are several approaches to define a business model. Each aims at understanding how a company works, and how its engine moves. That engine is made of things like key partners, resources, processes and how a company makes money.
Those approaches start from assumptions about what a company is and what aspects to focus on. Therefore, any attempt at classifying business model might never be complete enough.
For the sake of this article, I’ll put a label on each business model, by picking what I think is the most qualifying ingredient for the organization in the current moment. The aim is to provide you with as many business insights or at least stimulate your curiosity about these organizations.
As any labeling system, it has many limitations. Just like putting a label on a person is reductive, putting one on a complex organization is even more simplifying.
It is important to remark that this is not a science. A business strategy itself is made of assumptions about how the world works. In my opinion, the role of the entrepreneur is to test those assumptions in the real world as quickly as possible. When those assumptions turn out to be wrong, we’ll call them “failures.”
Yet in reality, those are feedbacks about the world at that moment. For instance, an idea might be too early for the world to accept, and an entrepreneur which is trying to push it to the market will fail.
It is important to notice that complex organization (think of Amazon, Google, and Microsoft) don’t rely on a single business model pattern, but have combined them to create a unique organization that can capture a long-term competitive advantage.
For instance, Amazon runs on several models, from a subscription-based, to cloud as a service, to an online store, third-party stores and more.
While this is true for larger organizations, consolidated over the years; for smaller organizations, or unicorn startups a simpler business model allows them to scale up to a billion dollar valuation.
I did my best to put the right label on each of the Unicorns, part of the FourWeekMBA Unicorns Business Models for 2019. This label comprises the main feature of that company from both product and monetization standpoint.
The Unicorns come from a list of 311 companies by CB Insights.
I hope you enjoy and get as many insights from it!
Originally published at fourweekmba.com on January 19, 2019.