Strategies to Discover Hot Investment Opportunities in Future Unicorns
“If you are going to be in business, you must learn about money: how it works, how it flows, and how to put it to work for you.” ― Idowu Koyenikan
Investment is the best course of action if you wish to make your money work for you. Investments allow an investor not only to grow wealth but also generate an additional income. Hunting for right investment opportunities is an ever-growing phenomenon all over the world. For investors, identifying a successful investment is just like an enigma.
Recently, unicorns have emerged as a potential means for investors. To discover future unicorns for investing is no cakewalk since it needs an effort with lots of foresights. According to CB INSIGHTS, there are more than 400 unicorns in the world. Every unicorn is somehow revolutionary as novelty in business is a proven method to create a dynamic result. The next unicorn may not be a splashy consumer brand but it should be a product or a service which will help others get things done.
Why are Unicorns Successful?
- It provides a simple solution to complicated problems.
- A product or service from a unicorn makes consumers more engaging.
- Tech unicorns become a digital place where users can easily interact.
- Unicorns have a strong and more viable value proposition.
- It has a long vision with high-tech services and products.
- Unicorns make the world more productive.
- Future unicorns may become a solution for economical recession.
- Investors keep looking for future unicorns.
- With a unicorn app, users can get multiple services in one platform.
- It may later become a decacorn or even a hectocorn.
Successful start-ups spread their wings with three future-centric components; the first in the industry, world-shattering innovation and customer-friendly. Investors should keep an eye on investing their time to find out start-ups that emerge with these three elements.
The First in the Industry
Most of the start-ups are technology visionaries and trendsetters. They emerge as the first service provider or product introducer in their industry to change the way people do things. Gradually, these start-ups become a unicorn that is a must for the society.
Innovative elements convert start-ups into unicorns to bring a disruption in the domain they belong to. For example, some online delivery services changed the way consumers commuted. To stay ahead of competitors, they prepare to keep innovating their services and products.
Since unicorns are B2C companies, their simple goal is to provide user-friendly products or services. They focus on day to day life with the support of innovative disruption. Moreover, providing affordable service or product is another key highlight of unicorns.
Sectors of Future Unicorns
Unicorns keep evolving in various sectors. Some of the key sectors: Financial services, Hardware, Healthcare, and Software. Investors should adopt result-driven strategies to discover thriving start-ups that will become successful unicorns in future.
[ According to FinTech Magazine, Lemonade, Monzo, Brex, TransferWise, Toast, Klarna, Robinhood, NuBank, One97 Communications and Stripe are top ten unicorns in the world. ]
Fintech service companies provide timely and fast financial services that range a wide-ranging impact individually and commercially.
As more and more customers interact on digital devices, Fintech services are based on consumer-friendly that develops consumer engagement and building trust.
Digital payments create a convenient and speedy service for those who depend on reliable and quicker payment services.
Many Fintech brands offer multiple services across one-stop app. Users from all walks of lives can immediately use these services for various reasons.
As Fintech service providers offer region-based flexible options for consumers, Fintech services occupy every region all over the world.
Evidently, hardware unicorns dominate in future. The new wave comes from various sectors. Some of them are:
- Artificial Intelligence companies that use hardware like Mobvoi and Anki
- Production companies that manufacture 3D printers with high resolution and advanced materials
- Advanced robotics start-ups such as UBTech, Rethink Robotics, and Roobo
Many of these start-ups would achieve unicorn status sooner or later.
The upcoming healthcare unicorn will definitely be one of the companies that are related to seven healthcare sections.
Seven Healthcare Unicorns
- Big Data & Analytics
- Imaging & Diagnostics
- Insurance & Drug Pricing
- Wearables & Devices
Software start-ups mushroom here and there. Discovering the potential start-ups that is capable to turn to unicorns is a really challenging. Here are some of the important elements to identify promising future software unicorns.
- Adaptable to face new challenges in underlying market
- Highly innovative infrastructure
- Rapidly emerging and growing
- A clear long vision
- Providing services on multiple domains
[ According to the analysis of CB Insights and Fast Company, 50 high momentum and promising start-ups will become future unicorns. Read the article at: https://www.cbinsights.com/research/report/future-unicorn-startups-billion-dollar-companies/ ]
Compelling data to monitor
With the team of creative employees and the pool of tools, sources and data, companies do some innovative things to make our life magical. During this pandemic, these companies are redesigning consumer trends, reshaping company infrastructure and redefining business models. Hence, an investor comes across several inevitable factors to keep in mind.
Understanding the infrastructure of company, identifying competitive advantages, and monitoring financial performance are crucial factors that investors, especially those who wish to invest in future unicorns, should focus on before investment.
To get projected revenue and growth, investors should observe these elements for finding out the best start-up to fund. And also, investors need to refer statistics for forecasting growth for the next five years or a decade. When it comes to monitoring data, some of the statistics and general data to examine are: Year established, founders, total funding, current valuation, headquarters, branches, revenues, board of directors, the latest company news and domination in digital world.
Understanding the infrastructure of company
Analyzing and understanding the infrastructure of a company is paramount since many start-ups lack of good infrastructure. The infrastructure of a company includes every fixed asset such as the building, machinery, equipment and tools, and all the employees and a management team. Investors should ensure whether the start-ups are with all fixed assets, skilled employees and an efficient management team.
Identifying competitive advantages
Savvy investors should meticulously analyse a start-up’s key competitive advantages to conclude whether it is a future unicorn.
Key competitive advantages
- Future-based business concept
- Financial and technological wealth to face any new competitor
- Customer retention techniques
Monitoring financial performance
Investors should be more careful and in monitoring the financial performance of a company since this is the time of pandemic. The financial performance of any company is based on four key features such as:
- Financial ratios compared to competitors
- Financial statements
- Industry benchmarks
- Market value
Before investing in future unicorns, three major aspects – Recognizing future-centric components, discovering successful sectors of future unicorns and monitoring data on particular start-ups – should be a must-have action for investors. Focusing on these factors helps investors understand the most active start-ups that will turn into unicorns in future. As start-ups sprout everywhere, investors keep puzzled to identify future unicorns that will make the world technologically enriched Utopia. In this case, deep understanding with meticulous statistics is the best way of identifying and adopting future unicorns for investing.