Just like in real life, unicorns often turn out to be illusions.

A private company that someone, somewhere decided is worth a billion dollars. A billion dollar valuation is not necessarily related to whether or not a company is profitable. See WeWork, Uber and Lyft.

“From an investor perspective, particularly for traditional venture funds that are $600 million, the way the math works is you have to be investing in unicorns. If you have a billion dollar fund, you have to own a certain amount of a $10 billion company to be able to be doing a good job.”

-- Aileen Lee, venture capitalist who coined the term unicorn in her 2013 report on billion dollar startups



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