Analysis: 166 new unicorns have already been created in 2021, up from 163 in all of 2020; Tiger Global has invested in twice as many unicorns as Sequoia Capital
Gené Teare / Crunchbase News :
Context & Ripple Effects
Unicorn creation was already running hot before this data point: after 142 startups crossed $1B in 2019 on declining fundraising totals, global venture money had been building toward records since $73B poured into startups in just the first seven months of 2018. The Crunchbase tally that 166 new unicorns were minted by mid-May 2021 — more than all of 2020's 163 — marks the moment the herd's growth rate visibly detached from anything prior.
The more telling number is who is minting them: Tiger Global has backed twice as many unicorns as Sequoia Capital, signaling that crossover-style volume investing, not franchise-stage selection, is setting the market's tempo. That pace proved cyclical — the same nine firms counted in Crunchbase's later tally of unicorn investments backed 471 unicorns in 2021 before collapsing to 44 by 2023.
First-order effects
- Tiger Global's velocity makes it the single most prolific unicorn-backer, forcing slower-moving firms like Sequoia to either accelerate deal decisions or cede early access to breakout companies.
Second-order effects
- With unicorns being created at roughly one per day industry-wide — CB Insights later pegged the global herd at about 1,000 with two added daily in early 2022 — the $1B threshold loses its scarcity value, pushing investors to compete on round speed and price rather than milestone exclusivity.
Third-order effects
- A market where a handful of mega-funds account for most unicorn formation is structurally exposed to a synchronized retrenchment when their capital sources tighten, which is what the drop from 471 unicorn investments in 2021 to 44 in 2023 reflects.
The trend: Unicorn creation has become a leveraged function of a few crossover funds' appetite, so herd growth now expands and contracts with those firms' cycles rather than with startup fundamentals alone.