Geographical and sectoral overview of the most valuable start-ups

Abstract

Our research aimed to identify the causes for the increase in the number of unicorn start-ups by analyzing the geographical and sectoral factors in two main online databases. The United States, with a traditionally strong innovation ecosystem, is leading the way in creating successful start-ups, but China, India and some European countries are also showing considerable results. The number of unicorns, referring to privately held start-ups worth more than $1 billion, is significantly influenced by qualitative factors (ecosystem development) and the size of the economy (nominal GDP). Therefore, small economies (like Israel) can only be included in the top 10 unicorn countries if their ecosystem is especially developed. The global pandemic has accelerated the digital transformation in several sectors. Fintech, e-commerce, internet, software and AI services are areas where unicorns have been able to achieve significant value growth. Introducing the attributes of these start-ups can be an inspiration for students in economics courses and can serve as illustrative examples in the related curricula.