Pulling out of the pandemic into an uncertain world businesses are looking to build solid growth and secure a stronger future. A mark of that growth is the sheer number of unicorn valued companies – now around 850, and growing fast. Their number moved by 48% from the end of 2020 to 2021. Over 350 companies reached a $1 billion+ valuation this year. So it’s very possible that we could see 1,000 unicorns in 2022.
Welcoming this news, six top executives from a variety of one billion USD ‘unicorn’ valued technology brands have come together to share advice for businesses looking to build that future now. Taken together these tips from visionary leaders form advice on how to start, build, and grow a fast-growth start-up from conception to a successful exit.
From finding the right market challenge to conquer, scaling a business at pace, maintaining a company culture through rapid growth, or pivoting when circumstances dictate, below is hard-won wisdom from technology and business leaders who succeeded in growing billion dollar valued businesses. Some are still pre-IPO, while others enjoyed hugely successful public launches. All of them are leaders in their market sectors. Perhaps the 1,000th member of the unicorn club is just waiting to be inspired…
Peggy de Lange, vice-president of international expansion at Fiverr
Many of the founders who pursued a passion and transformed it into a successful business were risk takers. Taking risks is a vital part of business growth and accepting failure is also important on that journey. At Fiverr, we champion this through our marketplace that helps people create ‘something’ from ‘nothing’ and our freelance community reflects this.
Today’s entrepreneurs are operating in an ever-changing and uncertain climate. Whilst there are plenty of opportunities to solve problems through innovation and game-changing ideas – flexibility and willingness to adapt when things don’t go to plan is vital to success. The entrepreneurs who find the most success are those that can adapt following a setback and learn from the experience. Remember, trust your ideas, your mission and your process.
Sergei Anikin, CTO of Pipedrive
Last year, on Pipedrive’s 10th anniversary, we achieved the exciting milestone of reaching ‘unicorn’ status. With less than 70 in Europe, this is no small feat. While there’s no definitive blueprint for becoming a unicorn, having played a role in Pipedrive’s road to success, I believe there are a few key ingredients that stack the odds in your favour:
Build a product or solution that solves an existing problem. To build a billion-dollar company, a good idea isn’t good enough. Your product or service must be solving an existing problem and be desired by a substantial market segment.
More than that, it’s critical to solve the chicken and egg problem at launch. Platform businesses need to grow two user bases that are dependent upon one another. For example, if Deliveroo wants to grow, it needs more delivery drivers and partner restaurants to get customers, and more customers to get more delivery drivers and partner restaurants. You can solve the chicken-and-egg problem by subsidising value, either monetary or product feature subsidies depending on which user group you are targeting and in what order.
To do this it helps to surround yourself with the right team. When we surround ourselves with positive and driven people we consciously (and unconsciously) challenge ourselves to be the best we can be. This is fundamental to driving a company to progress and develop.
Be flexible and willing to evolve. Recognising when a product or method isn’t working or needs a change of direction is critical to business growth. By understanding those gaps and imperfections you can always make away with them.
Damien Brophy, vice-president EMEA at ThoughtSpot
“Give your users the power to do what they always wanted” is a powerful mantra. ThoughtSpot allows anyone to ask questions of data as easily as using Google, democratising the ability to create new insights from this expanding resource. The beauty of this mantra is that it can apply to just about any business sector or human endeavour.
Everyone wants to be the best that they can, to be able to be their smartest, most creative selves and be a hero in their field. A start-up that helps people to fulfil their fundamental human challenges will thrive. ThoughtSpot sought from the beginning to put the power of self-direction in the hands of knowledge and front-line workers, to answer their own questions with business data, in the moment, with no waiting for anyone to get back to them later.
Behind every business challenge is a human being looking to succeed, and what is holding them back is not always only a legacy technology or an unmet need. The biggest barrier to their success is often fear. Where users have not been given suitable digital transformation there is fear. Fear from executives giving up control; fear from the IT department around data security; fear from analysts on giving up their role in business intelligence; fear from business users as to their data literacy and how their role might change. When you offer users the power to break through fear and become autonomous, successful, self-starting and fearless, you’ll have a winning formula.
UK’s leading AI startup and scaleup founders highlight the main pain points of running an AI business
Nick Mills, general manager, EMEA at CircleCI
Stay close to customers and never stop that focus
The most important thing is to stay close to your customer and maintain product-market fit. What happens too often is that as businesses scale, they tend to lose focus on product-market fit and get too locked into the relatively more mundane details of building out their company. The minute you lose touch with your customers, you cause a lot of ‘debt’ in the other parts of your business.
It’s even harder to do this right now, because somewhere in the process, relationships with customers are mediated by a screen, dictated by software. This has become the primary channel for customer engagement, so much so that seamless software delivery has become a critical competitive differentiator for all types of business. Therefore, making developer productivity needs to be your top priority. The performance level of a software engineering team has become a key indicator of a company’s future success. It may sound obvious, but having highly productive engineering teams goes a long way in bringing your products or new ideas to market faster. Understanding this and relentlessly keeping our focus on it is how CircleCI wins.
Zeki Turedi, CTO EMEA at CrowdStrike
Blow up the existing paradigm
Some start-ups aim to improve on a business model, while others aim to totally upend it.
The founder of CrowdStrike started our journey on an aeroplane. He was watching a fellow traveller start up their laptop, only for them to spend fifteen minutes waiting for the old antivirus software to finish loading so that they could do some work. It was symptomatic of a broken technology that was ripe to be changed, root and brunch.
An entrepreneur, particularly in the fast-moving world of technology, might see several of these opportunities in their career. Technologies and business processes need to evolve, and sometimes, need to be put to bed and have something better fitted to the modern tech stack and to business needs take their place. Many industries have been disrupted when changing times dictated that ‘good enough’ was no longer good enough. In cyber security, that came when signature-based antivirus and firewalls weren’t fulfilling their jobs anymore – when they were too slow and too inefficient to allow smooth work to happen. The cloud, AI, and new security paradigms (searching for live indicators of attack rather than past indicators of compromise, to get technical) were the factors that supported a new cyber security paradigm.
Entrepreneurs must keep their eyes open, as opportunities will become visible if you look for areas of friction and ask: “Must this continue? Can we improve this? Is it improveable?” Or, perhaps: “Is the time right for a new way?” That is often the catalyst for a new unicorn brand.
Guy Podjarny, co-founder and president of Snyk
The adoption and momentum that drove investors to our recent $530 million Series F funding indicates that the market for our developer-centric approach to security is increasing, and with success has come a great deal of learning. One of the most important things I’ve learned is to always be looking as far into the future as possible – hypergrowth has the tendency to make time move faster.
Here are a few places I’ve found it very helpful. First, hiring: you need to hire leaders that aren’t just up to the task at hand, but who you can trust to stretch to the needs of the rapidly approaching future. Second, infrastructure: the internal systems that you implement early on need to enable your rapid growth. Buying for today means you’ll be wasting time and money replacing those systems with ones that may have seemed too large only a year earlier. Third, focus: hypergrowth comes with hyperopportunity, so you need to set time-based growth boundaries and stick to them. If you pounce on every opportunity as soon as it arises, you’ll spread yourself too thin to execute properly.
Overall, it’s critical to anchor your decisions in the future, or you’ll miss your hypergrowth opportunity.
Building a better 2022
As we look towards 2022 and the expansion of the unicorn club into quadruple digits, it’s worth putting the right structures in place to grow wisely, innovate inventively, and better care for customers, staff, and our world. Learning from top tech success stories is a great place to start.