A new report published by a Shanghai-based research institute has found that there are more unicorns in China than the United States and the largest in the world.
There are 206 unicorns currently in China according to a research by wealth research firm Hurun. A unicorn is a privately owned company that has a net worth of $1 billion or more.
Compared to the 203 unicorns that have currently been identified in the US, the number is slightly higher according to the data from Hurun. According to the report, China and the US together accounts for more than 80 per cent of the unicorns in the world.
In terms of the number of unicorns, while the United States is ahead in the areas of cloud computing, artificial intelligence and life science, China surpasses the US in areas of e-commerce, electric car and healthcare industries.
The firm said that in this process of increasing the number of unicorns, Beijing also became the world’s “unicorn capital” and surpassed San Francisco of the US. There are currently 28 unicorns in Beijing compared to 55 in San Francisco.
This startup boom is fueled by China’s technology ambitions. The current strategy of Beijing is to urge Chinese companies to become less dependent on acquired technology from foreign companies and become dominant powers in some of the key industries within the next decade. This strategy has gained more traction during the ongoing trade war with the United States.
The Hurun’s inaugural list includes some of the major Chinese tech companies such as drone manufacturer DJI and the video sharing app Kuaishou.
“Three years ago, on our global rich list, China overtook the United States for the first time in the number of billionaires. Today, China surpassed the United States for the first time in the number of unicorns,” said Rupert Hoogewerf, the chairman and founder of Hurun, in a statement. He called the list a “surprise.”
However the number of Chinese unicorns included in Hurun’s list is more than other research firms. For example, only 99 unicorns were listed in China in an October report by CB Insights.
According to Hurun, world’s three most valuable unicorns are present in China. These one of the companies is Ant Financial which is a subsidiary of Chinese tech giant Alibaba and is a online payments company and has a valuation of $150 billion. The other two companies are Bytedance, valued at $75 billion and Didi Chuxing, valued at $55 billion. CB Insights’ October list also includes Bytedance and Didi Chuxing but it does not include Ant Financial.
There were was no response from CB Insights about how it arrived at the number of unicorns in China.
The criteria for selection of unicorns for the Hurun’s list were explained by Hoogewerf. Four major criteria were used – all of the companies had to be established on or after 2000, should have market value of at least $1 billion, should not be a public company and must have received funding from outside investors.
“We are trying to have a more complete count of unicorns in the local market,” Hoogewerf said, adding that many Chinese unicorns aren’t as well known internationally. “China has such a big economy, a huge population and a thriving new economy, it’s hard to image it only has 80 to 90 unicorns.”