LIKE A MOM GIVES BIRTH TO A KID TO CRAWL, WALK, RUN AND CONQUER THE WORLD, AN ENTREPRENEUR STARTS A STARTUP TO RAISE $1000, $100000, $1000000000, AND EARN A UNICORN STATUS.
Unicorn status is a massive deal for a startup that rises from the ashes. And considering the blossomed eco-system of the startup, it is straightforward for a startup to place itself on the radar of the investors and bag a decent amount of funds. However, investors are only interested in successful startups that solve real-life problems and attract many users. And thus, not all startups can raise enough funds to be called a unicorn.
If you are an entrepreneur running a startup and want to see your startup in the list of unicorn startups, you should place yourself on the radar of top investors. And the best way to achieve this is to learn lessons from the top unicorn startups.
In this blog, I will share 5 unicorn startups and their hidden business strategies, which depict why they have earned unicorn status so quickly. So, without any further due, let’s start with a startup that took less than 15 months to earn unicorn status.
Table of Contents
5 Unicorn tartups
Founded by Travis VanderZanden in 2017, Bird is a micro-mobility company that lets users rent e-scooters from the mobile app. As of now, Bird is operating its business in 150+ cities, and it is one of few startups which has crossed the valuation of 1 billion in just 14 months.
There are many reasons why Bird has successfully earned unicorn status. However, there is one primary reason that you have to know to find inspiration. Bird has presented a disruptive idea and solved the real problem.
By offering an affordable and accessible mode of transportation, Bird gives many reasons to users to give up on the car and choose its e-scooter. Bird has solved a few major problems for every commuter, such as traffic, lack of last-mile connectivity, and rising fuel price.
Coming up with a disruptive idea and solving the real problem of the users are the first two lessons you can learn to be a startup unicorn. For the success of any startup, it is essential that how useful its service/product is to the people and how its service/product solves the deep-rooted problem of the people.
Go-Jek is a SouthEast Asian startup founded in 2010 to offer an on-demand delivery service. In 2015, Go-Jek launched an app and started offering 3 on-demand services from the single app. The multi-purpose app idea of Go-Jek was so successful that currently, Go-Jek is offering 20+ on-demand services from a single app. And the valuation of Go-Jek is around $10 billion.
Suppose we dig deep and try to discover why Go-Jek’s skyrocketed growth, we can get the most common yet ignored reason. It is the reception of innovation!
During the underlying days of the Go-Jek, they used to dole out the drivers physically in the wake of checking their accessibility in the roaster. But now the backend of the Go-Jek app and the web is so technologically advanced that it processes all requests alone, with little human help. For instance, the 12 data engineers and a machine learning-based system handle 3 million + Go-Jek orders in a single day. You can imagine the money Go-Jek is saving and the prompt service it offers with an advanced IT infrastructure!
So, the third lesson you can learn to be a startup Unicorn is the fact that a technologically advanced backend of the mobile application or web application is the fundamental requirement to satisfy the requests of many users and keep the user satisfaction rate high, which eventually puts you on the radar of investors and make you a startup unicorn.
Warby Parker, esteemed over $1.3 billion, is the American online retailer of solution glasses and shades. The organization was established by Neil Blumenthal, Andrew Hunt, David Gilboa, and Jeffrey Raider and is headquartered in New York City. Warby Parker mainly sells its product through its mobile app and website. But they own many retail stores across the USA and Canada.
Here is the practical learning for the product-based startup. Building a solid supply chain and opening a few retained stores is a good idea if you are running a product-based startup. But that doesn’t mean you are good to go without an online presence.
A retail store, displaying and selling the same products you display on mobile apps and the web, is vital in high-level business exposure and widespread product distribution. It also helps you to enable users to test the product and buy the product instantly physically. It is the only reason Apple has yet to decide to sell its iPhones only through its online presence!
Everybody knows about Uber and the fact that Uber is the unicorn startup. But there is one hidden business strategy of Uber which only a few knows about. And ironically, this hidden business strategy of Uber is one of the reasons why Uber is a unicorn startup.
Uber follows the business model of the aviation industry. Like airlines make more money through their 20 business class seats than 100 economy class seats, Uber makes more money from its premium services than economy services. Uber’s premium services also help Uber to keep the revenue per employee high.
Learning (A bit complex, but game-changing)
By offering premium services and deploying the premium business model, you are indirectly promoting your affordable services and, at the same time, earning more by keeping the revenue per employee high. Here is how: when a user tries your premium service, he promotes your company, not the premium service. And since a premium user promotes your company, many users get attracted to your company, not the services of your company!
Airbnb is the online marketplace for arranging homestays. The company acts as the broker and enables users to book homestays. In 2019, Airbnb was valued at around $35 billion.
Surprisingly, people opt more for Airbnb homestays amid the availability of many hotels. But when we know that Airbnb homestay is more affordable than hotel booking, we can’t argue why people prefer Airbnb homestays over hotels.
Aggressive pricing does wonders for any startup!
In a nutshell
Starting a startup and leading it to unicorn status is more challenging. However, it isn’t as complicated as you think. By following some golden rules given to us by unicorn startups, we can make our startups earn unicorn status. I hope the startups and their hidden business strategies I have put forth in this blog will help you and your startup to see a better tomorrow.
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