The United States is a unicorn for making unicorn companies. These days, “unicorn” has come to mean a firm with a billion-dollar valuation, but the term used to simply refer to a person or thing that was truly special and rare. In that way, the USA is a unicorn nation, in that it does exceptionally well in creating exceptional companies.
That’s according to a new analysis [PDF] from the Center for Global Innovation at the USC Marshall School of Business, which reports that 64 percent of the global total of billion-dollar privately-held companies are based here. For that matter, 63 percent of the total valuation of unicorn companies is held here. The analysis covers the period from January 2014 to December 2015. As much as the this country stands out globally, the report also shows that Silicon Valley stands out within the U.S., as the dominant birthplace of big firms. The analysis is based on lists maintained by CB Insights and the Wall Street Journal.
“These results may help quiet those who have—perhaps prematurely—bemoaned the decline of the U.S. as a technology innovator and economic power,” Gerard J. Tellis, the center’s director, said in a statement.
The next closest countries were China (14 percent) and India (4 percent). In other words, size isn’t everything, but it doesn’t hurt either. That said, there’s a few tiny countries with more unicorns than one might expect based on their populations. Sweden, for example, ranks fourth on the list of total valuation of all unicorns (with only 2 percent, but that’s still big for a nation with fewer people than New York City). Israel and Singapore also stand out as tech hubs.
CB Insights shows 151 companies on its billion-dollar list today, while WSJ has 146. The number one company on both is Uber (which is also number one in drama), but both also show Chinese smartphone maker Xiaomi at a close second.
There has been talk that these big companies’ valuations might see corrections, as CNN Money reported, as some of the biggest companies return to investors for more cash, which feeds into the tech press talk of the bubble bursting; however, if we’re in a bubble now, as Vox has written, it doesn’t look anything like the 1990s bubble.
Mr. Tellis argues that the real insight from the analysis comes from which countries aren’t on it, such as former titans Japan and Italy. Mr. Tellis said, “What policy-makers should ponder is why Beijing and Bangalore rank high, but Tokyo and Rome do not.”