The Year Of The Decacorn: 2021 Shatters Records For Number Of New Startups Valued At $10B+

The Year Of The Decacorn: 2021 Shatters Records For Number Of New Startups Valued At $10B+

Investing — SCOTT BELSKY

In recent years, the startup ecosystem has seen a significant rise in the number of companies reaching a valuation of $10 billion or more, commonly known as decacorns. In fact, 2021 has been dubbed "The Year of the Decacorn" as it has shattered records for the number of new startups achieving this milestone.

Since the first private $10 billion valuation in 2007, a total of 84 decacorns have emerged. Out of these, 33 have already exited the market, leaving 51 decacorns still reigning supreme. However, what is truly remarkable is the rapid increase in the number of newly valued decacorns in 2021. According to Crunchbase data, 30 companies have already achieved this remarkable feat, surpassing the previous year's count of 15 and 2019's count of five.

Reflecting back on the history of decacorns, it is astonishing to realize that it has only been 14 years since the birth of the first decacorn. Facebook, now known as Meta, became the pioneer in 2007 when it secured a $15 billion valuation through a strategic investment from Microsoft. The second decacorn, Alibaba, followed two years later in 2009, with a valuation exceeding $10 billion. This marked the beginning of a wave that would continue to accelerate over the years.

Interestingly, there was a gap of five years without any new entrants to the decacorn club. It was not until 2014 that the next company achieved a $10 billion valuation. This demonstrates the exponential growth and interest in the startup world, with more and more companies reaching extraordinary valuations.

The Crunchbase Unicorn Board, a platform that tracks and showcases unicorn and decacorn companies, has recently surpassed a significant milestone. For the first time ever, the board has crossed the threshold of 1,000 companies. This highlights the sheer number of startups that have achieved a valuation of $1 billion or more.

In the realm of investing, Scott Belsky, a seasoned seed-stage angel investor, has been actively involved in supporting early-stage companies. His focus lies in consumer, marketplace, and "transformation by interface" space products. Belsky brings a unique approach to investing, emphasizing the importance of crafting the first mile, structuring design-driven product teams, blending copy and UX, optimizing defaults, and considering ego analytics.

Narrative plays a crucial role in Belsky's investment philosophy. He recognizes that positioning is not only important for external marketing but also for the team's perspective of their own product. A product's story matters greatly, and Belsky admires teams that prioritize initiative over experience. He believes that while the science of business revolves around scaling, the art of business lies in the things that don't scale.

Belsky is particularly drawn to mission-driven teams that value exceptional product experiences and are focused on solving a problem by connecting and empowering people. The best teams he encounters are those that leverage existing forces to their advantage. They possess remarkable imagination while remaining grounded in the present. These teams are driven by empathy for those who are experiencing the problem and are always unsatisfied with the current state of their product.

In conclusion, the surge in the number of decacorns in 2021 showcases the incredible growth and potential within the startup ecosystem. The rapid pace at which these companies are reaching valuations of $10 billion or more is a testament to the entrepreneurial spirit and innovation that drives the industry forward. Aspiring entrepreneurs and investors can draw inspiration from the success stories of these decacorns and learn valuable lessons from industry experts like Scott Belsky.

Actionable Advice:

• 1. Prioritize initiative over experience: When building a startup team, look for individuals who are proactive and driven to take initiative. Their enthusiasm and willingness to go above and beyond can make a significant difference in the success of your venture.

• 2. Craft a compelling narrative: Don't underestimate the power of storytelling. A strong narrative can captivate both your team and potential customers, creating a sense of purpose and connection. Spend time refining your product's story and ensure it aligns with your mission and values.

• 3. Embrace dissatisfaction: Never settle for the status quo. Continuously strive to improve your product and address the pain points of your customers. Embrace feedback and constantly seek ways to enhance the user experience. The most successful companies are the ones that are never satisfied and are always pushing for innovation.

By incorporating these actionable advice and understanding the dynamics of the decacorn phenomenon, entrepreneurs and investors can navigate the startup landscape with greater confidence and increase their chances of success in this exciting and ever-evolving industry.