Stuck In The Exit Door: Pace Of $1B+ Exits Still Not Enough To Deal With Global Unicorn Glut

The IPOs of Snap and Mulesoft in March 2017 gave hope to venture investors that a flurry of IPOs would bring a breaking of the dam in terms of unicorn IPOs. There are currently still 168 venture-backed companies valued at $1B or more in the private markets awaiting exit globally, out of the 189 total. But there has only been an average of 25 $1B+ venture-backed exits in the last 3 years.

At that rate it would take over seven years for all the current VC-backed unicorns to exit at $1B or higher.

Globally, the number of $1B+ VC-backed company exits peaked in 2014 at 32, fell to 20 in 2015, and bounced up to 23 in 2016.

There have been only 4 so far this year, and although the IPOs of Okta and Cloudera are expected, that means this year is only on pace for 20 or so $1B+ exits and the pressure on unicorns to exit will only continue to build.

Meanwhile, some valuations are under pressure. Middle Eastern e-commerce player Souq, which was valued at $1B earlier this year, was bought by Amazon for $750M earlier this week. And Indian e-commerce site Flipkart saw its valuation cut from $16B to $11B last week.