Up to August, CBinsights reported that there were over 390 unicorns, private corporates valued at USD 1 billion or above, in the world and over 1/3 of unicorns are from the U.S. while nearly 1/5 come from China.
Categorized by industry, the Internet and IT services industry incubated the most unicorns as many as 52, but unicorns in the financial industry are valued the highest as much as USD 140.53 billion in aggregation. The U.S. unicorns dominated most listed industries and in industries like Internet & IT services, financials, and healthcare, the U.S. unicorns counted for more than 50%.
CBinsights recognized 32 unicorns in the healthcare industries. Comparing to the Internet and IT services, which came into people’s sights in the last century, the healthcare is a traditional industry that exists along with human’s history, and so the fact reflects on the age of some healthcare unicorns.
1/3 of the healthcare unicorns just reached the unicorn line
Among the ranking list, nearly 1/3 of the healthcare unicorns hit the USD 1 billion valuation line. The valuation does not indicate a strong relationship between the founding age. The eldest unicorn Otto Bock HealthCare entered its 100th year while most of the healthcare unicorns were founded in the 21st century. The most valuable unicorn Samumed, a biotech company specialized in cell tech, was founded in 2008 with a valuation of USD 12 billion.
According to China’s domestic database, itjuzi.com, there are 19 healthcare unicorns in China using the same standards – private and valued at USD 1+ billion. Considering recent changing currency exchange rates, Chinese healthcare companies that are valued at CNY 6.5+ billion will be counted as unicorns.
In 2016, over 10% of world GDP was generated from healthcare spending. The healthcare industry was formalized as early as in 1963 from the U.S. After decades of development, the healthcare industry has become the fifth pillar of the nation’s economy. Health spending accounted for 17.9%, reaching USD 3.5 trillion, of 2017’s GDP in the U.S. and Centers for Medicare & Medicaid Services predicted that in 2027, the spending will account for 19.4%. Even when the Financial Crisis crushed the financials, manufacturing and retail industries, the healthcare sustained a stably uprising trend.
On the other side of the Pacific, China’s healthcare spending accounted for less than 7% of GDP in 2016 and the government planned to raise the percentage above 7% by the end of 2020. China’s healthcare has plenty of room to grow to compare to the U.S.’ healthcare industry.
The 10 most-valuable healthcare unicorns worldwide
Up to July 2019, 4 out of the 10 most valuable companies are headquartered in the U.S. and 4 are from China and 2 from Europe.
Samumed was founded in 2008 by Osman Kiber. Its latest financing round closed in 2018 with a deal amount of USD 400 million. The biotech company has no public products and neither the late-phase clinical trial ongoing, but such a status quo does not prevent it from being the most chase-after company for investors and now, it is valued at USD 12 billion.
Top 10 fast-growing healthcare unicorns
Once it would take around 10 years for a startup to grow into a unicorn. With day-to-day speeding investment activities, it takes much less time for a startup to become a unicorn these days, even in the healthcare industry, which is regarded as the industry with the longest investment return period.
GRAIL, Devoted health, and Tencent Trusted Doctors spent only a year from zero to billion-dollars-valuated unicorns. From the graph, it is easy to find that later-founded unicorn companies spent less time to become unicorns. On the other hand, the accelerating process implies a rush in the investment world.
GRAIL was founded by Jeffrey Huber in 2016, and its investors include the Chairman of Microsoft, Bill Gates, and Jeff Bezo’s backed venture capital Bezos Expedition. The company closed the latest financing series in 2018 with a deal amount of USD 300 million from Chinese VC organizations.
7 out of 10 fast-growing unicorns are settled in the U.S., and the rest 3 are in China. The U.S. takes the lead in cultivating unicorns, whether in speed or in valuation.
Healthcare tech and biotech count for the most unicorns
The marketing is expanding rapidly in size and differentiating. From analyzing the global healthcare unicorns’ vertical industries, we can discover an interesting phenomenon: China has the most unicorns in healthcare IT service while the U.S. occupies the most chairs in the biopharmaceutical and genetic technology unicorn counts.
Despite the reason for the scarcity of healthcare service worldwide, aging is another drive pushes the healthcare industry to move forward in regions like East Asia, the U.S., and Europe. The data for China, the aging population (>=60 years old) might account for 35% of the total population in 2050 comparing to the world’s 21%. The sharp change in population’s composite will generate a huge market for the healthcare industry.
Plus the generations growing up under the Internet time, healthcare with Internet power has been reshaping the healthcare service process. Doctolib, a France-based online healthcare service provider, was established in the last decade and became a unicorn valued at USD 1.14 billion. The Hong Kong-listed Ping An Good Doctor (平安好医生) is a famous online clinic and healthcare service directory platform in China.
The development of healthcare-related innovations and startups heavily depends on the region’s R&D level and the market size. The U.S. and Europe are the origin of the modern healthcare industry and the legacy pass down through centuries. China, as a representative fast-growing country, is ready for accelerating the healthcare development to relieve regional healthcare service scarcity and becoming a huddle for future biotech giants.
The healthcare industry has fewer unicorns than the IT, financial and retail industries, but it has strong momentum to surpass them because of biotech development, aging crisis, and the eternal pursuit of a healthy life.