More than 80% of the world's billion dollar-valued start-up companies come from the US and China
China has overtaken the US as home to the highest number of privately-owned billion-dollar start-up companies, with the three most valuable unicorn businesses based in Hangzhou and Beijing.
Of the 494 unicorn start-ups established in the 2000s and not yet publicly-listed that were identified by Hurun, 206 were based in China, compared to 203 in the US.
The Chinese research and investment firm, best known for compiling the Chinese rich list, estimates the total value of these companies to be $1.7tn, making the average unicorn business worth $3.4bn.
The San Francisco Bay Area, often referred to as Silicon Valley, has the highest concentration of such companies, with 102 (21%) unicorn start-ups located across San Francisco, Palo Alto, Redwood City, Sunnyvale and Mountain View.
Hurun Report chairman and chief researcher Rupert Hoogewerf said: “These young companies, only seven years old on average, are the world’s most exciting start-ups, leading a new generation of disruptive technology.
“China and the US dominate with more than 80% of the world’s known unicorns, despite representing only half of the world’s GDP and a quarter of its population.
“The rest of the world needs to wake up to creating an environment that allows unicorns to flourish in.”
The report was released against the backdrop of an ongoing trade war between the two largest economies in the world.
However, discussions between US president Trump and Chinese leader Xi Jinping are seeking a trade deal that would bring an end to the increased tariffs being placed on goods.
India and the UK were the closest competitors to the US-China hegemony, with 21 and 13 unicorns respectively.
Only 24 countries globally can lay claim to a billion-dollar start-up.
In terms of the sectors, fintech proved to be the most profitable, representing 22% of the total value of unicorn start-ups listed, while e-commerce was the most prevalent with 68 online platforms looking to compete with the likes of Amazon.
US venture capital firm Sequoia has the best track record in identifying billion-dollar start-ups, with 92 unicorns in its portfolio.
Chinese conglomerate Tencent and Japanese investment giant Softbank also have a knack for identifying market disruptors, with 46 and 42 unicorns apiece.
Top 10 most valuable unicorn start-ups
Ant Financial – $150bn
Ant Financial takes the title of the most valuable start-up in the world.
The Hangzhou-based fintech was spun out of Alibaba’s Alipay, and now the online payments platform can lay claim to 700 million active users.
The company accounted for 35% of all venture capital investment in fintech companies in 2018 and its most recent $14bn funding round helped elevate its current valuation.
ByteDance is best known for its social video-sharing platform TikTok, which now boasts more users than Twitter.
Founded in 2012 by Zhang Yiming, the Beijing-company also owns AI news aggregator Toutiao.
A $3bn funding round in October 2018 helped bring its valuation to $75bn, making it the world’s biggest privately-backed start-up at the time.
DiDi Chuxing – $55bn
Beijing-based ride-sharing platform DiDi Chuxing was able to outmanoeuvre Uber in its local Chinese market and acquired its operations there in 2016.
It serves 550 million users across 400 cities and has since expanded into Australia, Japan and Latin America.
As with Uber, DiDi is diversifying into the food delivery, e-bike and autonomous vehicle sectors.
Infor – $50bn
Enterprise software and cloud computing company Infor is the first US start-up to make Hurun’s list.
Headquartered in New York, Infor offers more than 40 software-as-a-service solutions to its corporate clients.
One such product, Cloudsuite, is used by businesses to manage finance and HR operations.
Juul Labs – $48bn
E-cigarette manufacturer Juul Labs commands 70% of the electronic cigarette market in its native US.
Founded in 2015, as the vaping trend picked up, Juul witnessed a 614% increase in sales between 2016 and 2017.
The company was backed by Altria – Philip Morris USA’s parent company – to the sum of $12.8m in return for a 35% stake.
Airbnb – $38bn
The original proponent of the sharing economy, Airbnb has revolutionised short-stay accommodation since it was founded in August 2008.
The accommodation marketplace now provides access to more than six million properties in around 81,000 cities and 191 countries.
The start-up’s long awaited IPO is predicted to take place next year.
Lufax – $38bn
Shanghai-based Lufax is an online finance marketplace.
Beginning life as a peer-to-peer lending platform in 2011, the company helps match borrowers to investors.
SpaceX – $35bn
Although Elon Musk’s main company Tesla doesn’t make the list, as it is a publicly-traded firm, his space exploration company SpaceX makes the top ten.
The California-based company, which has the ultimate goal of sending colonisers to Mars, has contracts with NASA and has facilitated several successful tests of super-size rockets.
WeWork – $30bn
Office rental provider WeWork retains its $30bn valuation on the Hurun unicorn start-up list due to a $1bn Series H funding round, led by SoftBank, in January.
The Japanese investment firm may now find itself having to bail the company out after it had to pull its proposed IPO in September due to overestimated market value and continued losses.
Stripe – $23bn
Payment provider Stripe was founded in 2010 by brothers John and Patrick Collison.
Its software provides the digital infrastructure for businesses to make and receive payments online.