How many unicorn companies are in the UK?

How many unicorn companies are in the UK?
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In the business world, a unicorn is a privately owned business valued at over $1billion. But how many UK unicorns are there? Let’s take a look.

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What is a unicorn business?

Search for the term ‘unicorn’ and you’ll likely come across images of a mythical horse with a straight horn on its head.

However, highly successful, private startup businesses are also referred to as unicorns. That’s because a unicorn is something highly desirable, but very difficult to obtain. 

Think about it: millions of businesses are launched every year, but only a tiny number go on to be valued at $1 billion. To put this into context, of all the software startups founded in the 2000s, a mere 0.07% achieved unicorn status.

The term was first used by venture capitalist, Aileen Lee of Palo Alto, California in 2013.

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How many unicorns exist?

According to SJA accountancy, there are currently 701 unicorns in the world, with the majority based in the United States. Unicorns exist in a wide variety of sectors.

Famous Unicorn companies include Reddit, Stripe and Elon Musk’s SpaceX.

How many unicorns are there in the UK?

While the United States dominates the list of unicorn companies, Forbes reports that there are 91 unicorns in the UK. The Digital Economy Council also reports that the UK ranks fourth worldwide for the number of technology start-ups and unicorns created.

Popular UK unicorns include financial technology giant Revolut, payments processor Checkout.com, and online car dealer Cazoo.

Aside from the number of UK unicorns, SJA accountancy reports that the UK has produced almost 217 unicorn executives, 14 of whom attended Oxford University. This means that the UK has the second-largest number of executives working in billion-dollar organisations.

Is the number of UK unicorns likely to increase?

It’s fair to say that the number of UK unicorns is likely to grow in the future if recent trends continue. In 2010, only eight billion-dollar companies existed in the UK, compared to 91 today (data from May 2021). This rise has likely been due to huge investment in the UK tech sector over the past decade. 

Recent additions to the billion-dollar club include Monzo, Starling Bank and Octopus Energy. Interestingly, these companies all achieved their mythical status within the past two years.

What are ‘futurecorns?’

‘Futurecorns’ refers to companies that have the potential to reach unicorn status in the future. To be considered a futurecorn, a company must be valued between $250 million and $1 billion.

Forbes reports that there are 126 companies that have the potential to become UK unicorns, putting the country well ahead of its European neighbours. 

According to research conducted by Dealroom and the Digital Economy Council, UK futurecorns include Zopa, Bulb Energy and Atom Bank.

Can UK unicorns lose their status?

The valuation of a business can both rise and fall. As a result, an organisation can lose its unicorn status should its value drop below the magical $1 billion figure.

However, this isn’t the only way a business can lose its status as a unicorn. A large business can lose its unicorn label if it’s taken over by another company. 

Another way a business can lose its unicorn identification is by offering its shares to the public. This may be in the form of an initial public offering (IPO). This is because to be considered a unicorn, a company must be privately held.

Former UK unicorns include the Hut Group, Farfetch and Darktrace. These businesses all lost their status due to launching an IPO. Shazam and Skyscanner, meanwhile, both lost their golden status following takeovers.

If you’re looking to invest in a startup, see our article on why and how to invest in startups.

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