In recent years, venture capitalists have used the term “unicorn” to describe the statistical rarity of a startup that’s achieved a $1 billion valuation.
However, these “mythical” startups are no longer uncommon.
Globally, there are now 276 companies with the billion-dollar unicorn designation. Some of them are already household names, like Uber, Airbnb, Pinterest and Dropbox.
Collectively these startup unicorns carry a $967 billion market valuation on an aggregate investment of $200 billion.
That’s nearly a 400% return in just a few years.
But none of these returns have accrued into the brokerage accounts of the everyday investor. Rather, these investments are restricted to venture capitalists and high-net-worth investors.
Instead, everyday investors have found themselves “holding the bag” when once-hot startups like Snapchat and Blue Apron finally made their way to the public markets, and proceeded to fall 50% and 65% from their opening prices.
It’s no surprise that investors are anxiously clamoring to get in on the ground floor of the next moonshot.
Enter the Cryptocorn…
Bitcoin may be the largest and most discussed crypto. However, it’s only the first application of blockchain technology.
While bitcoin posted a 1,485% gain in the past year, the decentralized platform for smart contracts known as Ethereum skyrocketed 12,822% in that same time period. Conceived by then-19-year-old Vitalik Buterin in 2013, the Ethereum platform has underlied the creation of 1,000 new blockchain projects.
As entrepreneurs find new ways to apply blockchain’s innovative technology to solve real-world problems, these ideas are being met with waves of new capital from nontraditional investors.
Current investor demand for these projects is drastically outstripping the supply of companies, and these are the necessary ingredients for a financial mania.