India fourth in terms of start-up unicorn numbers; less than tenth of China’s: Hurun index

5 August 2020: When it comes to start-up unicorns, India is the fourth biggest behind the US, China and the UK, housing 21 of the global total of 586 in terms of valuation. The combined valuation of these 21 unicorns stand at $73.2 billion. An additional 40 unicorns have been founded by people of Indian origin which are mostly headquartered in Silicon Valley, US, according to the Hurun Global Unicorn Index, 2020. The value of the 40 which have Indian origin founders, but headquartered outside India, stands at $99.6 billion.

The US has 233 unicorns and is closely followed by China with 227 and both of them together account for 79% of the world’s unicorns. UK is third with 24 unicorns.

“The US and China continue to dominate with 80% of the world’s known unicorns, despite representing only 40% of the world’s GDP and a quarter of the world’s population. The rest of the world needs to wake up to providing an ecosystem that allows unicorns to flourish,” Hurun Report India MD and chief researcher Anas Rahman Junaid said.

Start-ups with over $1-billion valuation are called unicorns.

Interestingly, of the 21 Indian unicorns, Chinese investors like Alibaba and Tencent have invested in 11 of them. Japanese investor Softbank has investments in 9 of them, while the USA’s Tiger Global has invested in 5.

The number of Indian unicorns is just a tenth of China’s 227, according to the Hurun list. Further, China has only 16 businesses started outside the country by its diaspora as against India’s 40.

A third of the 21 Indian unicorns, which include Paytm, Oyo Rooms, Byju’s, Ola Cabs, etc, are in the e-commerce sector and Bengaluru is the unicorn Capital of India being home to 8 such enterprises, the report said. The youngest Indian unicorn is the 2017-founded Ola Electric, followed by Udaan and Swiggy, it said, adding on average, it takes 7 years for a start-up to achieve unicorn status in India as against 5.5 years in China and 6.5 years in the US.

Valued at $16-billion, Noida-based Paytm is the highest valued unicorn in India, while Robinhood, co-founded by Baiju Bhatt, is the most valuable unicorn which is based outside India. Hangzhou-based Ant Group, spun out of Alibaba in 2014, is the world’s biggest unicorn with a valuation of $150 billion, on the back of its impending IPO in Shanghai and Hong Kong. At the second place is Beijing-based ByteDance, founded by Zhang Yiming in 2012, best known for its news aggregator platform Toutiao and short video platform TikTok. Taxi-hailing app Didi Chuxing, founded in 2012, is the world’s third largest unicorn with a valuation of $55 billion. Last year Didi started expanding outside of China.

The Indian Institutes of Technology (IITs) have emerged as the lead source of unicorn founders, with 36 of the founders being from these institutes and IIT-Delhi being the most preferred one. From a gender perspective, the ratio is not favourable, with 104 Indian unicorn founders being male and only five of them being women, the report said.