The legendary unicorn, frequently depicted as horse with a horn protruding from its forehead, has captured imaginations since antiquity. In 2013, the term was appropriated by venture capitalist Aileen Lee to refer to a statistical rarity – namely, a startup with a market valuation of at least $1 billion. Since then, the ranks of the coveted Unicorn Club have swelled by nearly 500%, signalling a bold new era of ambitious businesses, where not even the sky’s the limit.
Seeking to reach $1 billion in valuation is a Big, Hairy Audacious Goal… but is it a righteous undertaking for a startup? That’s the question we put to more than a dozen industry experts, this week, for our exclusive “Let’s Talk…” feature looking at growth. The consensus was that while’s there’s nothing inherently wrong with aspiring to be a unicorn (with one commentator stating, “we need more ambition, not less” in a nation rife with tall poppies), founders mustn’t let the pursuit of this milestone distract them from building sustainable, innovative and customer-centric companies.
One commentator pointed out the irony of there being a dearth of female-led unicorns despite the term being coined by a woman, before adding that more startups would earn themselves a “glittery horn” if they focused on “the new female economy and female-driven innovation.” Another suggested that unicorns valuations have been inflated and that the financial bubble is bound to burst.
Read on for further insights from this week’s line-up of “Let’s Talk…” commentators.
“Is there anything wrong with aspiring to be a unicorn?”
Mark Gustowski, Acting CEA, QUT Creative Enterprise Australia (CEA): “Reaching a billion-dollar valuation – or the unicorn milestone – is absolutely a cracking goal for startups to strive to reach as it means they were thinking global from day one. There are currently more than 260 unicorns running the world and each of them needed to perfect their startup concoction before they sold it. Your startup should focus on hand-picking the most brilliant minds for your team; once you’ve perfected that collective consciousness, the pathway to creating your startup prodigy will become clear.
“Make sure you dedicate due time and thought to shaping your business lifecycle to include a combination of investment and grants. You always want to demonstrate to investors that you’ve laid the financial foundations which will in turn give them confidence in your ability to handle any injections.
“Rather than wanting to be a unicorn that struck it rich, think like a prodigy; how will your startup cause change? Be the company that redefines the world – not the billion-dollar unicorn stamp.”
Gerard Healy, Co-founder & Managing Director, Titlexchange: “There’s nothing wrong with aspiring to be a unicorn and Australia should do better at fostering dreaming big. However, Australia suffers terribly from tall poppy syndrome and too often those who talk about desiring to be a unicorn get stared at like they’re a leper.
“Unfortunately, this attitude often trickles down from investors. Founders are told to be more realistic, which is essentially code for scaling back their ambitions. Imagine if people like Henry Ford, Walt Disney and Elon Musk had suspended belief in their bold plans to appease investors. As a nation what we need is more ambition, not less.”
Sean Senvirtne, Founder & CEO, MyDeal: “The ‘Get Big Fast’ maxim has been around for a long time. Aspiring to get big fast is good as it can enable a business the critical mass it needs to grow and capture its market share and compete with established brands and businesses. Fast growth comes with its own unique challenges. Fledging but rapidly expanding businesses can lose sight of the very innovation and efficiencies that got them off the ground in the first place. It’s important to stay focused on the business objectives and stay true to your value proposition.”
Bec Brideson, Founder, Venus Comms & author (Blind Spots): “Despite the fact that the term ‘unicorn’ was coined by a woman, female-led ventures aiming to be unicorns are a rarity (as are unicorns with women on their boards) and we absolutely need more. Yet there’s an even bigger reason why we need more men and women aspiring towards being a unicorn, despite the lottery-like probability. The intense tech-focused climate and ‘bro-lensed’ system for accessing unicorn status in Silicon Valley overlooks a giant opportunity – namely the $28T global female market.
“Whether female- or male-led, using gender intelligence to fill the yawning gap that is needed by new products and services that better serve women’s modern demands, provides a prospect that is greater than the economies of China and India combined. Yes, it’s rare to reach unicorn status, and it’s even rarer to reach unicorn status as a female lead – but all entrepreneurs may find a higher likelihood of claiming a glittery horn and ergo high-growth and rapid commercial gains, by laser focusing on the new female economy and female-driven innovation.”
Tanya Titman, Accountant & Founder, Acceler8: “We need to see a convergence of the startup and SME mindset. Historically, SMEs haven’t been challenged to aspire to be unicorns and startups have always been focused on lofty goals. They are selling a dream, they dream big but they don’t always make it. SMEs are realists, they tend to take a more conservative approach – often because they have more to lose, like staff who depend on their employment and equity from their home that has been invested in their business.
“Where does this mindset come from? Often small business owners start a company because, as an employee, they excelled in their industry and decide to branch out on their own. Startups have a new idea designed to disrupt the status quo, one that could be a “million-dollar business”, their mindset is not limited by existing industries practices or benchmarks. We need a cultural change in this area within Australian business. We should aim for startups to take a more realistic approach and SMEs should aspire to bigger growth goals.”
Amanda Watts, Co-founder, Girl Geek Academy: “Having seen first-hand how technology has changed the way we communicate, and how we can reach new markets and scale businesses fast, there has never been a better time to build a $1 billion business.
“Barriers to entry such as startup costs are so much lower than they used to be. Technology is getting cheaper and we have many more tools at our disposal to track if our marketing efforts are working. Technology is fun, not scary, and it’s a lot easier than you think to get setup. In my experience you can build your business at a third of the cost compared to five years ago, and there is no reason why we shouldn’t take advantage of this.
“There’s nothing wrong with aspiring to be a unicorn, just as long as you are setting yourself up to win. Is your customer base fundamentally large enough to be able to get you to the $1B mark? Is the problem you are solving big enough and will people pay good money for you to solve it? To put yourself in the best position to achieve unicorn status it’s key to charge more for your solutions sooner. Get money in your hand as soon as you can, from a customer. Even if that amount is small at the start – it allows you to see your value, don’t give it away for free.
“As Australians we are isolated from the rest of the world (and the assumed unicorn headquarters of Silicon Valley), however this should not deter anyone as we have some great support networks and events all around Australia. On a personal note, I am especially keen to see more females aspiring to unicorn status. In order to achieve this, I think it’s about visibility. We need to physically see more female role models in unicorns and fast growing companies being profiled. When we are deciding on a career, we are often influenced by popular culture; it would be great to see more movies, stories and books depicting women starting and growing businesses. I dream of ringing the bell at the ASX and so can you!”
Mick Spencer, Founder & CEO, ONTHEGO: There is nothing wrong with having a really ambitious business goal that everyone in the team is motivated by and working towards. This should not just be monetary however as the goal needs to resonate with everyone in the business. The aspiration to be a unicorn is more of an achievement for the founders and executives of a company and it needs to be broken down into realistic smaller chunks or tasks, so they can measure their progress consistently. Otherwise, it’s just blue-sky dreams. Fundamentally, entrepreneurship is flawed if founders get caught up talking about wanting to be the next unicorn at the expense of perfecting their product for their customer or strengthening the foundations of their company. Becoming a unicorn is the by-product of creating something that changes the world. The change should be the goal, not the status.
Dr Marcus Tan, CEO & Medical Director, HealthEngine: “No, I welcome the challenge. From day one, HealthEngine’s goal has been to improve the way Australians access healthcare and empower them to better manage their health through consumer-friendly technology — the more resources we have at our disposal ultimately brings us closer to achieving this goal and improving the overall healthcare of our nation.
“Successfully scaling comes down to your mentality — it’s not so much how fast you grow but how you grow that will determine whether you reach unicorn-status. This means having a clear mission from the get go and hiring the right talent that share your vision, not shying away from technology (this is at the heart of everything we do at HealthEngine, facilitating everything from our products, services and operations to managing our internal communications and company culture), and most importantly, knowing if you’re ready to grow — understanding whether your current infrastructure, business model, employees and product is equipped to handle new growth is key.
“Over the last 12 months HealthEngine has undergone rapid growth — raising $26.7 million in our Series C funding round in April, doubling our workforce from 70 to 140 nationally, launching several new products and features on the platform — which has paved the way for our continued growth in 2018 and beyond.”
Chris Chang, Program Manager, Techstars Adelaide: “Speaking to investors, many will say that there’s something wrong in NOT aspiring to grow a billion-dollar startup. I’m not sure I would be 100% in agreement, but I would definitely say there’s nothing wrong with aspiring to have your company become a unicorn. But it shouldn’t be seen as the only measure of success. The best founders I’ve met are far more focused on getting their businesses to solve a problem than just having a massive valuation. If the problem is big enough, when you start helping more and more customers solve it on a global scale, reaching unicorn status will be the by-product of building a great company.”
Atomic 212° Chief Strategy Officer, Ben Taylor: “On one hand, I feel that Unicorns are much needed in today’s short-term, ROI-based business culture where considered, safety-first management is paramount. Against this backdrop, the ‘anything’s possible’, entrepreneurial culture of unicorns like Vice, Hulu, Blippar and DocuSign, which are creating products and services for tomorrows opportunities, really captures one’s imagination.
“Another part of me worries that we’ve created yet another buzzword for something that has always existed and that we’ve now run out of sight of all financial sensibility (I.e. the basics, values…how money systems operate). Uber, at $60bn+ valuation, sometimes has losses 100% more than revenue, according to reports. Looking at the sheer number of Unicorn companies (as shown here) and the valuation against current return rates, it feels like every financial bubble-bursting reality that we’ve never learnt from. The number of Unicorns has grown from 46 in 2013, when Aileen Lee coined the ‘Unicorn’ term, to 267 today. It seems unicorns aren’t the statistical rarity they once represented.
“So, should your startup aspire to be a unicorn? I think you should always aspire to the irresistible momentum of start-ups due to the fact that the world shifts daily around new opportunities. Looking at the number of established blue chips on the Unicorn investor list alongside the large VC funds would suggest that big businesses can’t do everything internally and need to acquire or invest externally to grow. In essence, we can see blue chip businesses investing in unicorns as a catalyst for innovation that would not occur within mature businesses. But you should temper this with financial responsibility. Most importantly, ask yourself not only whether you should you aspire to be a unicorn, but whether you can facilitate the environment, focus and purpose these companies build around themselves.”
Patrick Garrett, CEO, Six Park: “Ambition is a prerequisite for a start-up – most people wouldn’t put themselves through the blood, sweat and tears otherwise.
“The question is, do you aim to be a billion-dollar company for the sake of it, or do you aim to solve a problem and achieve success as a result? Six Park’s mission is to make sure all Australians can get professional, low-cost investment advice – if we become a unicorn in the process that would obviously be fantastic, but it’s not the end goal.
“We’re a really motivated team and we know that the way we’re going to be successful is by making sure we have happy, loyal customers who love what we’re doing as much as we do. Six Park helps people grow their wealth so they can spend less time worrying about money and more time enjoying life. That’s something everyone would like to be able to do, really, and we want that for both our clients and for our company.”
Kerry Boulton, CEO, The Exit Strategy Group & Author (Million Dollar Pay Day): “There is a great saying… “shoot for the stars…” and if you do, you might reach the moon! That’s my personal take on aspiring to be a unicorn. If you have a technology, or have developed a really potent, successful brand you could licence globally (akin to Virgin), unicorn status should be in your sights!”
Anthony Sochan, Partner, Think and Grow: “There is nothing wrong with aspiring to be a unicorn, in fact we encourage all our customers to reach for the stars and be as ambitious as they can possibly be. Our role is to help enable those ambitions. However, you do need to be aware of the market opportunity, size of that market and the pathway you would need to travel to get there, it’s not for everyone. First and foremost we encourage others to build great businesses that they can be proud of, everyone defines great in a different way and as a community we should be comfortable with that.”
Heidi Holmes, co-founder & COO, Mentorloop: “I don’t think there is anything inherently wrong with aspiring to be a unicorn, it just shouldn’t be your primary focus. Starting and growing a business is incredibly hard and we’ve learnt first-hand that blind optimism only gets you so far. Instead time, energy and resources would be better spent focussing on delivering a product or service that delights your customers. Being 100% customer centric and building a company that people want to work for is key to ensuring that you build at a minimum a sustainable, profitable business and we believe that approach only makes you more attractive to customers and investors.”
About “Let’s Talk…”
This exciting new, weekly initiative provides entrepreneurs and industry experts with a forum to share rapid-fire views on a range of issues that matter to start-ups and SMEs. Every Wednesday, we pose a themed question to a line-up of knowledgable industry figures, with a view to picking their brains for valuable insights to share with you, our readers.