Have you heard about unicorn fintech? The term, which has become increasingly common, refers to a portion of financial start-ups that reach the mark of more than $1 billion in market value.
Whether for their innovative ideas, or for the amount of technology employed in their processes, there are already several representatives of the industry that have managed to conquer this so desired title. Find out what you can do to make your fintech the next unicorn.
What are unicorn fintech?
The term unicorn start-up was coined in 2013 by Aileen Lee, founder of Cowboy Ventures, to refer to companies that had reached a value of $1 billion. Since at the time this was a privilege of a few, the figure of the rare mythological animal was chosen to characterize them.
Nowadays, as companies reach this level more frequently, unicorns are divided into generations, according to the year in which they managed to achieve the title.
In the case of fintech, most of the representatives among unicorns managed to reach this level due to the financial contributions received. In 2018, CB Insights recorded the figure of $39.57 billion in funding for companies around the planet.
In 2019, 48 unicorn fintech were identified worldwide, 7 of them having entered the category in the second quarter of the same year. In Brazil, ABStartups counted 21 unicorns in 2021, a number that could quadruple in just 5 years.
With the increase in the number of start-ups with billionaire values, another nomenclature has emerged to categorize the companies that have managed to reach a valuation of more than $10 billion. For this reason, in 2021, 19 companies were considered dragons, Nubank being the only Brazilian representative among them so far.
Who are the Brazilian unicorns?
Latin America has been a very fertile ground for start-ups. The region registered record venture investments in the year 2021, totalling 18 new start-ups with valuations higher than US$1bi. Brazil was the country that more launched the new unicorns to the market, reaching the mark of 9 more companies integrating the category.
Speaking specifically about unicorn fintech, Brazil ended 2021 with 5 representatives. Among them, PagSeguro stands out, which, although it has generated controversy with its arrival in the world of mythological winged horses, already has more than 40 million clients.
Another fintech that reached the unicorn level was C6 Bank, a start-up idealized by former BTG Pactual partners that provides checking account and credit card services. In 2020, C6 received an investment of $1.3 billion, which made it a new unicorn in the sector.
Besides these two examples, there are already several well-known names that figure among the group of mythological equines. Creditas, Ebanx and Stone are some of the financial start-ups that have reached the mark in 2021, and Brazil is still expecting new entrants in this category, such as CargoX and FreteBras.
Technology in favor of unicorn fintech
There is no step-by-step tutorial capable of turning any fintech into a new unicorn. But by analyzing the trajectory of the representatives who have already reached it, it is possible to notice something common to the history of all of them.
The potential for growth, for example, is one of the factors that stands out the most. All fintech listed as unicorns are constantly expanding, including with regard to the global market.
This potential is made possible by another factor: the ability to scale their business. Through agile methodologies and operations that involve little human labor, it is increasingly possible to expand services to more users in a short period of time. And the more users the more the business has, te more it thrives.
But the greatest asset of fintech is precisely the technology employed in an ever-growing need of the consuming public: to be able to perform financial transactions in a practical, fast, safe, and unbureaucratic way. For years known for its slow procedures, the financial institutions market has gained new life with the arrival of fintech. This has increasingly motivated customers, who feel more secure in joining the start-ups’ services and leave traditional banks behind.
Behind this technological revolution are new service delivery formats, which even influence the corporate organization. Many fintech have been betting on outsourced technology consulting, relying on specialized companies to promote more innovation focused on the consumers’ needs. Through agile methodologies, technology consultants have been fundamental to facilitate the scaling of the businesses, paving the way for fintech to reach the desired unicorn level.
Every day, new unicorn fintech break the billion-dollar barrier and continue on their way to growing business success. Your fintech can also be a new member in the group of winged horses of start-ups through a technology consultancy. Monitora serves several companies, delivering customized solutions according to each business.
Contact our team of specialists and learn more about our services.
