The word unicorn once conjured images of mythical creatures – but the term is now associated with hugely successful tech companies.

More and more businesses are passing the coveted billion-dollar valuation mark each year. Globally there are now 241 unicorn companies in existence – and combined they're worth a staggering $818bn.

New research from Compare the Market has found that on average it has taken seven years from launch to grow these companies into unicorns. However 19 made it to $1bn in less than a year – an incredible achievement made possible by technology.

“Technology certainly has had a part to play in the speed at which companies can scale,” Will Douglas, associate director of business insurance at Compare the Market, told BusinessCloud.

“It’s easier than ever before for brands to reach new audiences and promote their offerings, whereas the once-taken traditional route to market required significant additional resource and typically took far longer.”

The start-ups who achieved unicorn status in less than a year are APUS Group, BeiBei, Cambricon Technologies, Dada, e-shang Redwood, Global Fashion Group, GRAIL, iCarbonX, Illumio, Indigo Agriculture, Maoyan-Weiying, Pinduoduo, Uptake, Weiying and Xiaomi.

The fastest, consumer electronics manufacturer Xiaomi, came from nowhere with no real advertising.

“They pooled all of their resources into offering value for money,” explained Douglas. “Through saving money on high-end marketing campaigns, they were able to offer competitive prices which got people talking.

“They leveraged the power of word of mouth comes back to the concept of going viral, without spending a small fortune on advertising.” 

Taking yourself to market quickly is key, according to Douglas. “[All of these fast-growing] companies identified an opportunity and took advantage of this,” he added.

→ READ MORE: NEW UK UNICORN 'SHOWS NEED FOR PATIENT CAPITAL'

The United States is home to the highest number of unicorn companies, with 116. The UK is home to just 13 yet is still the third-highest worldwide behind China, which has 65 unicorns. 

Technology is a broad church – so which types of business have been the quickest to grow?

Mobile and real estate start-ups reach unicorn status the fastest, at an average of just two and three years respectively, closely followed by biotech, cyber security, fitness, social and travel – all of which take an average of five years to get there.

“With regards to software and mobile, they’re creating applications and solutions that can scale rapidly without incurring significant additional cost – they’re growing at such speed because of the value they add to their customers,” said Douglas.

“In the case of real estate, it’s the likes of WeWork who have contributed to such growth; revolutionising traditional approaches to property and, again, creating value through their offering.”  

Douglas says that most interesting high-growth unicorn who many won’t be familiar with is Illumio, a start-up whose solution prevents the spread of breaches inside data centres and cloud environments.

“With an increasing awareness from both B2B and B2C audiences in cyber security and data protection, we think we’ll be hearing a lot more from this business over the next few years,” he said.

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