A third of Europe’s ‘Unicorns’ are British businesses

The number of unicorn businesses – tech-based start-ups valued at $1 billion or more – in Europe is on the rise.

According to tech investment bank GP Bullhound there are now 47 such businesses in Europe, representing a growth of 10 new Unicorns over the past year alone. According to the bank, the combined value of these companies is now $130 billion (£90 billion).

Just over a third originate from or are based in the UK. These include relatively well known companies such as online fashion and beauty store ASOS and property search resource Zoopla. Augmented reality specialist Blippar is a new British entry to the Unicorn list and business planning software makers Anaplan were founded in the UK but are now based in San Francisco.

Sweden now has the second largest number of Unicorns, with seven billion-plus dollar tech firms, including the single most valuable in Spotify. The music streaming service has overtaken Skype with a valuation of $8.5 billion.

Germany has the next highest number of unicorns with six, followed by France and Israel (which was included as part of the European study) with three apiece.

There are questions to be asked regarding the high valuations of some of these businesses however. European Unicorns do have higher average revenues than those in the US, suggesting that investors on this side of the pond aren’t quite as willing to inject money into ventures with little to no income on the prospect of future rewards.

There have been some high-profile failures however, such as Powa Technologies, which found itself in administration despite having been valued at close to $3 billion. Despite their income streams, almost half of the European Unicorns are still not turning a profit, including some big names such as Spotify and Funding Circle.

According to GP Bullhound, the available data points to a stable and maturing market that has avoided some of the excesses of the US in favour of sustainable growth in the field of technology start-ups.

By Phil Smith

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