China is now home to 369 unicorns – start-ups valued at more than USD1 billion – with more than a quarter involved in the artificial intelligence (AI) and semiconductor sectors, according to a report jointly published by five institutions – including KPMG, the Zhongguancun Unicorn Co Development Alliance and consultancy Great Wall Enterprise Institute. These Chinese unicorns have an average valuation of USD3.8 billion. Across 16 sectors, AI unicorns are the highest valued, at an average of USD6.76 billion, followed by financial technology firms at USD6.57 billion, the report said. The number of unicorns in the AI and semiconductor sectors accounted for 14.1% and 12.2% of the 369 total respectively. Beijing has the most number of unicorns at 114, followed by 63 in Shanghai and 32 in technology hub Shenzhen. The growth in unicorn numbers reflect the gloomy state of initial public offerings (IPOs) in Hong Kong, Shanghai and Shenzhen, where more companies have delayed their listing plans. Alibaba Group last month scrapped the listing of Cainiao Smart Logistics Network, after cancelling the spin-off of its cloud computing business and freezing the IPO of its Freshippo grocery chain last November.
Twenty-five unicorns, according to the report released at the Zhongguancun Forum (ZGC Forum), were incubated by Chinese Big Tech companies, including Tencent Holdings, Alibaba, and Baidu. More than 70% of the 369 Chinese unicorns also received investment from funds with an international background, the report said. Established venture capital firms were major sources of funding for Chinese unicorns, including HongShan, formerly Sequoia Capital China, which invested in 96 of the 369 unicorns. Citic Capital was involved in funding 74 of these unicorns, while Tencent invested in 56 firms.
China, however, continues to remain behind the United States in the overall number of unicorns. There were more than 700 unicorns based in the U.S. and over 340 in China in last year’s global tally of 1,453, according to the Global Unicorn Index 2024, published by the Hurun Research Institute earlier this month, the South China Morning Post reports.
