78 Health Unicorns downgraded in our mark-to-market valuation scenario. From a $335B valuation herd, down to $181B.

The 147 strong Health Unicorn herd spreads right across the open-source Global Health Landscape taxonomy

While 147 organizations are currently anointed as Health Tech Unicorns, understanding the true picture of the Unicorn landscape requires a much closer analysis of the types of startups that have achieved this milestone. By mapping the Health Tech Unicorns to the Global Healthcare Landscape taxonomy we are able to break down the cohort by sub sector and by cluster.

Figure 2. Health Unicorn Evolution - Founded, Unicorn Crown and Exits

Mapped to the Global Healthcare Landscape, we can see that Research is the biggest sub sector for Health Unicorns; emphasizing the high-risk, high-reward nature of clusters such as Health Discovery, Precision Medicine and Genomics. After Research the next most prominent Sub Sector is Systems. This area of the market captures the organizations aiming to tackle the sizable inefficiencies and productivity challenges across global healthcare. At a cluster level it is perhaps unsurprising that Telehealth represents nearly 10% of the list, given the explosion in the use of ‘virtual first’ care during the Covid-19 crisis. On the public markets the largest telehealth companies are trading at a fraction of 2021 valuations and in many cases - but not all - telehealth Unicorns are feeling the pain as hybrid models of care replace virtual only provision, margins are squeezed and increased competition pushes up the cost of customer acquisition. 

Figure 3. Valuation Patterns of 147 Health Unicorns, by Valuation and by Year each Company became a Unicorn

To qualify for Unicorn status, organizations must be a private company with a valuation over $1B. Unicorns are ‘startups’, i.e they do not include post-exit, acquired or listed companies, nor do they include ‘mature’ incumbents. By most metrics, 2021 represented a high watermark for startup valuations - particularly for organizations with technology-led solutions. Of the 147 Unicorns, 84% became Unicorns since the pandemic. So far in 2023, only Kindbody has joined the Unicorn club.

73% of the 43 IPO Exits are trading below 50% of IPO Valuation with 40% trading below 20% of IPO Valuation.

By viewing the 147 Health unicorns by their ‘Unicorn year’ - the point at which a private funding round valued the organization in excess of $1B - we can see once again the extraordinary impact of the pandemic on the volume and valuations of Health Unicorns. Just over half of the existing Unicorn herd achieved this status in 2021, when cheap capital and the rapid growth of virtual first care models converged to supercharge the market. 

Figure 3. Unicorns by Valuation and Valuation Age

The public markets are also an accurate indicator of the extent to which valuations have shifted. The IPO window was wide open during 2021 and competition to trade high-growth health organizations on the public markets was key to the uplift of valuations across the market and the subsequent expansion of the Unicorn herd. When we consider the current trading value of a cohort of health companies that listed during this period we can see collectively they are valued at a 0.69 discount to the price they entered the public markets at.