Public Markets Venture

Keeping Tabs On New Unicorns Isn’t Easy

Morning Markets: A quick reminder of how hot the tech market is at the moment, through the lens of unicorn birth.

News broke late last week that Plaid, a company that provides banking tools via software, may raise as much as $200 million at a multi-billion valuation. That’s pedestrian enough in today’s technology market.

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Less so was the fact that venture shop Kleiner, which Bloomberg reports is offering Plaid a $3 billion valuation, did so after “[a]nother investor valued the company at about $2 billion earlier [last] week.” So, Kleiner added another billion on top?

It’s competitive out there for investors hoping to get a piece of an attractive deal.

There isn’t any public information (that I could find) this morning about Plaid’s last Series B valuation. The firm raised $44 million from a passel of investors, but at what price isn’t clear. Given that it was merely a Series B, I doubt that Plaid hit the $1 billion valuation threshold in the round. So, it’s likely that the company will earn its horn during its impending raise.

That raised a pre-coffee Monday question: Who else? Plaid, after all, isn’t as well-known as the consumer-facing giants in the tech space and Plaid’s work in the fintech-finservices world isn’t exactly headline bait. So we could easily have missed this impending transaction altogether, missing a budding new unicorn at the same time.

Who else is about to become a unicorn, or just managed the task? A huge number of companies, as it turns out, of which I selected a few to make a point. Ask yourself honestly as we go through this list, how many of these had you heard of before, and of those how many could you explain without aid?

  • Root Insurance: I missed this company entirely. Root, as it turns out, raised a $100 million Series D (Crunchbase) last quarter led by Tiger Global that pushed its worth to $1 billion. The firm sells car insurance and was founded in 2015.
  • WalkMe: With $40 million more this September, WalkMe managed a pre-money valuation of $960 million. And since $960 million plus $40 million equals $1 billion, it made it! WalkMe sells software that provides guides inside of apps to help users find their way around.
  • Formlabs: You’re wrong! Formlabs is a 3D printing company that raised a comparatively-small $15 million round last quarter that pushed its value up to $1 billion (from a $985 million pre-money valuation). Formlabs has raised $45 million this year.
  • Convoy: This one was easier to guess. It’s a startup that connects truckers and freight, likely bringing a needed dose of technology to an old-fashioned industry. Last month it raised a massive $185 million round at, you guessed it, $815 million pre-money valuation. As before, that adds up to one thousand million! Also known as one billion.
  • JFrog: Developer tools that help with the writing, and then dissemination of code, so far as I can tell. And it’s a unicorn! Yes, this month JFrog tacked on, as expected, $165 million at an $835 million pre-money valuation. That equals $1 billion. Good job, everyone.

And on and on (more here). It’s a goddamned zoo out there, or at least a unicorn preserve. There are clouds of the feral things out there today.

Which brings us to our kicker: Today’s lack of liquidity. I have a new hunch that despite an improved IPO market, we’re still miles from having the unicorn liquidity crisis solved. And, at the pace that we’re minting fresh unicorns, I doubt that we can ever dig out.

This is from 2015, but it holds up just fine.

Illustration: Li-Anne Dias

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