Over the years, the term “unicorn” has become synonymous with success and wealth. But is the pursuit of unicorn status really worth the risk of running into losses? In this blog post, we’ll explore the quest associated with becoming a unicorn and whether it’s worth the effort to reach that coveted status.

In a time when startups are striving to survive in a dynamic and fast-paced market, startups like Zepto, Dunzo, Rapido, and Ninjacart have the potential to become top unicorns in 2023. Meanwhile, Flipkart, BharatPe, Swiggy, Nykaa, MakeMyTrip, and Ola Cabs are the most valued unicorns of 2023, although some of them don’t even make a profit. On the other hand, there are a few companies with exceptional profitability, but their valuations don’t allow them to become unicorns. 

Given this, it’s essential to examine startups running at a loss despite being unicorns. When it comes to unprofitable unicorns, nobody can forget Zomato, Uber, Swiggy, and Paytm, which are among the most popular and talked-about startups. They have large enough valuations to rank among the top unicorns, but they are not profitable. In contrast, a few startups like EaseMyTrip, Zerodha, Dream11, Zoho, and InfoEdge are profitable, a rarity nowadays.  

On the other hand, some exceptionally brilliant and profitable startups might be smaller compared to these unicorns in terms of valuation and revenue, but they have excellent profitability and are on the threshold of becoming unicorns in 2023. Though it’s difficult to predict specific names, it’s believed that startups related to e-commerce, fintech, healthcare technology, artificial intelligence and machine learning, and clean energy could potentially become unicorns in 2023.

Apparently, the focus of most startups has been on expanding valuation, not profit. They want to build a brand and a name rather than making profits. Startups are willing to operate at a loss if it means achieving a valuation of Rs. 1 billion and unicorn status. 

For instance, let’s take Zomato, the business that delivers food to your doorstep. You might think that when it charges double the usual rate to deliver a product, it must be making countless pennies. But no. In fact, it’s running at a loss. Though it generated revenue of over 55 billion rupees in 2022, it’s still operating at a loss. All it has is a large valuation, eventually leading it to become a unicorn. 

The global superstar Madonna once said, “Fame is a form of misunderstanding.” It seems that this quote applies not only to humans but also to these unicorns, which are misunderstood as profitable businesses by people. 

But the question is, is this right for the industry, customers, investors, and individuals? Loyalty and honesty are key elements an individual expects from an industry or company, while investors look for long-term profitability and significant change for all. 

Attaining unicorn status confuses people and blinds them to the core values that help businesses establish a set of guidelines to perform their primary duties. Respect, strong communication, skilled employees, employee retention, and, most importantly, dedication to development are some key business fundamentals one should never forget. 

However, to achieve unicorn status, startups are willing to risk everything they have, including basic fundamentals like respect, loyalty to customers, and their aim to solve bigger problems. They don’t want to look beyond the status of a unicorn. Ignoring the basic fundamentals of a business, they pressure themselves to attain unicorn status at any cost. 

It’s important to note that investors often lose interest in non-profitable or less profitable businesses. They don’t want to stay with companies with large valuations that have little scope for profits in the long run. So, to attract good investments, one needs to focus on recognizing the key business fundamentals and putting them into action. 

Considering all this, it becomes a matter of intense scrutiny whether these risks of financial crisis and social and fundamental growth are worth the status of a unicorn. Moreover, is it acceptable to ignore the fundamentals of a business (profits, solutions to problems, ethics, etc.) to create a seemingly significant unicorn that contributes to a country’s economy on the surface? 

With a total of 108 unicorns, India might appear as a wealthy and values-driven nation, but this hollow structure of building unicorns renders the notion irrelevant. This illusory charm of a unicorn is sending an incorrect message to the young entrepreneurs of our country who aspire to become billionaires. Furthermore, there’s a possibility that it might persuade investors to shift their focus to other places or platforms where they can actually find the ideal startups and businesses to invest in. 

In the end, it is necessary to remember that to become a successful startup, you need to adopt a different approach. Try to look beyond what you see with your eyes and take care of everyone’s needs and aspirations. Strive for profitability, ethical operations, and problem-solving instead of chasing the elusive status of a unicorn.