Hi there,

Space fans will love that NASA’s new director of the Goddard Space Flight Center, Dr Makenzie Lystrup, took office last week, swearing her oath not on the Constitution, but on a copy of Carl Sagan’s 1994 book, Pale Blue Dot.

In this Open Letter:

• World of Unicorns: Inside the 1’200+ companies over $1 billion.

• Goodbye Tupperware, no more Twitter & where’s the money, Mr Pres?

• Bootstrapped billions: Self-funded startups that sold for massive amounts.

• Watch: How would you build a Unicorn from SA?

TRENDING NOW

The World of Unicorns

Know where you wanna go, right?

Recently CB Insights released a list of all the unicorns they could find. And, though they’re not fantastical horned horses, they’re just as rare. And for many (especially investors), the $1b valuation milestone mark is a significant achievement.

Now it’s important to note that valuation could simply mean that they’ve raised funding at a valuation higher than $1 billion, so there’s no guarantee they’re even making a profit or in fact, any money whatsoever. Nonetheless, the list makes for interesting reading about private companies (not yet listed or bought by listed companies) that have a valuation of over $1 billion.

The Standout Unicorn

At a $225 billion valuation, ByteDance (the company behind TikTok) is valued $88 billion higher than SpaceX and tops the list. Whilst that could seem high, it’s very much an expected valuation given their recent revenue announcements.

With most of these companies trading at 5x revenue, ByteDance would want to wait a few more years before their much-anticipated IPO.

Where are the Local Unicorns at?

Of the 1’207 on the list, we found 5 African domiciled ones:

• Opay – Fintech/Banking – $2b

• Wave – Fintech/Banking – $1.7b

• Promasidor Holdings – Food and Beverage – $1.59b

• Cell C – Telecoms – $1b

• Mnt Halan – Fintech/Banking – $1b

Cell C a unicorn? Yep, you haven’t heard them speak at tech conferences about this, but as far as private company unicorn criteria go, they make it. Also worth noting is that depending on which USD exchange rate you use, Rain could very much make that list. Incredible considering they only launched in February 2019.

And then, most likely due to exchange control limitations, some African startups domiciled elsewhere also on the list are:

• Flutterwave – Fintech

• Andela – Remote tech teams

• Chipper Cash – Fintech

• Esusu – Proptech

Where most Unicorns hail from

An interesting observation made by Paul Graham is that 7% of companies listed here went through California-based startup accelerator Y Combinator (YC). But that wasn’t Paul’s best work on Twitter this week. After Elon stated most companies on the CB Insights list won’t make it, Paul was quick to weigh in…

Speaking of hardware and heavy industries, there is one startup on the list that might end up being worth more than all of those combined. They are building the world's first fusion power plant that’s making atoms fuse together at 100 million degrees Celsius and, in doing so, generating 100% clean energy.

Remember, just like magic horses, unicorns can come from anywhere – and raising large amounts of capital is not the only way. There’s a list of bootstrapped ones later in today’s Open Letter.

Spot someone who’s not on that list and should be. Or maybe you have a tip-off on our next potential unicorn… Hit reply and let us know.

IN SHORT

💸 Where’s the money? SA Pres Cyril Ramaphosa claimed to have raised a record R1.2 trillion of investment in the country in 5 years (as a businessman, his fin savvy’s what he was elected for), so why isn’t that extra cash creating economic growth?

🫖 Phone your mom, she might be in shock as the news that Tupperware (yes THAT Tupperware) is in trouble and might be closing soon, ending 80 years of lunch, supper and leftover memories (and fights) – leaving moms everywhere scrambling for a new excuse to get together.

🦾Tech for good: Now that your mom has more time on her hands after the demise of Tupperware, it just might be the perfect time for a new hobby. Western Cape upliftment project Mamas4Coding teaches moms how to code.

⚡️ More, we need more: Amid Stage 6 loadshedding (since last night), SA’s newly appointed Minister of Electricity says we need more money to fix the energy crisis. 🤷🏽‍♀️

🤖 The next wave: Dharmesh Shah, founder and CTO of HubSpot has confirmed he bought the domain name chat.com (for a rumoured $10 million) as a new home for his ChatSpot.ai product because he believes ChatUX (natural-language-based chat) will be the next big thing in Tech.

🆇 Twitter no more: Crazy as it seems, Twitter no longer legally exists. This came to light during a California lawsuit case filed against Twitter Inc. (no more). Instead, Twitter is now merged with Elon’s holding company X Corp – which sounds like a Lex Luther-style evil corp but is probably related to Musk’s mystery plans for a Super App called X.

😐 Watch your back: In what sounds like the opening line of a joke, the CEO of the Society for Human Resource Management turned down an employee’s request to work remotely, outsourced her job to India and then bragged about it to Wall Street Journal. 2 Things: 1) maybe that’s why people hate work and can’t trust their bosses and 2) don’t ever work for a guy called Johnny C. Taylor Jr.

WATCH THIS SPACE

Top Bootstrapped Unicorns

There’s always this convo around bootstrapping VS funding. And whilst raising large amounts of funding is a necessity when hyperscaling, there are other ways to become unicorns.

We did some digging to find some bootstrapped unicorns. 9 out of 10 of these bootstrapped companies are unicorns, eventually exiting for $ billions. The remaining one was almost there, selling for hundreds of $ millions...

Playing the Unicorn game? We might have some content to help you.

• The panel discussion at Specno’s 2023 Founders Den event features OfferZen co-founder giving amazing insights into bootstrapping – re-watch it all here

• For some funding advice, we spoke to an accelerator who gives some in-depth advice on funding and VCs in one of our recent Open Conversations – re-watch the convo here

THE THREAD

How would you build a Unicorn?

Want to get going building a unicorn? Listen to the latest episode of How would you build it, we unpack how South Africans can go about it. You can now also catch it on Spotify.

Have you listened to How would you build it? Hit reply and let us know what you think or topics you think we should cover.

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