Unicorn Market Cap & Industry Towns, 2020

This post is by Elad Gil from Elad Blog

In 2019 I wrote about how “industry towns” emerge in every market. These clusters of people, ideas, capital, service providers, and companies tend to have strong network effects that support startup formation and success in a given industry. 

For example, Silicon Valley, London, Beijing are global tech centers. New York, London, HK, Shanghai etc. are global finance centers. Hollywood, Lagos, Bombay are global movie centers.

Given all the IPOs in the last 16 months (including Snowflake, Unity, Asana, Palantir) and the sharp decrease in market cap in some companies (WeWork), I thought it would be interesting to update the view of where unicorn market cap currently resides. 

Some big caveats include (1) Unicorn market cap is a lagging indicator of ecosystem health since many companies take anywhere from 2-7 years to be worth their first billion (2) COVID and the move to more remote work or “remote first” startups may impact what this looks like in 4-5 years (3) San Francisco governance may decrease San Francisco’s long term relevance, although the broader Bay Area should be strong longer term. A big thanks to the talented Shin Kim for pulling & structuring the data below (raw data here if you want it).

Unicorn Turnover
Since June 2019, 37 of the 361 Unicorns at the time went public, 14 were acquired, and 8 did down rounds or shuttered. 187 new unicorns emerged in the last 15 months (>3 a week!) which means 38% of total unicorns today are new (Read more…)