The next Deliveroo? Latest startups to join the unicorn club

Last year, six UK companies reached unicorn status after securing a $1bn valuation. In doing so, they’ve displayed enduring innovation and business determination that defied the challenges posed by a difficult trading climate.

These numbers position Britain as a leader in European unicorn creation, as the next closest contender for the title was Germany, which saw the birth of four unicorns in 2023.

While the numbers have shrunk in comparison to previous years, the UK has continued to create unicorns for the seventh year in a row. Read on to meet the latest startups to join the unicorn ranks.

The UK’s newest unicorns

From a sports apparel brand backed by tennis player Andy Murray to an AI builder that democratises access to software development, these are the startups that reached unicorn valuation in 2023.

Quantexa

Year founded: 2016
Founders: Imam Hoque and Vishal Marria
Current valuation: $1.8bn

Headquartered in London, Quantexa is a big data and enterprise intelligence provider, using technologies including entity resolution, network analysis, and AI to deliver complex services that detect and prevent financial crime. After a $129m Series funding round led by global institutional investor GIC, Quantexa was catapulted to unicorn status. The company has also created buzz in the tech sector thanks to Q Assist, a cutting-edge generative AI assistant.

Synthesia

Year Founded: 2017
Founders: Lourdes Agapito, Matthias Niessner, Steffen Tjerrild and Victor Riperbelli
Current valuation: $1bn

The London-based generative AI company recently secured a $90 million in a Series C funding round, crowning itself as the third unicorn announced in Europe in 2023. Synthesia is leveraging the power of AI to transform video creation, as users can effortlessly generate professional videos by providing a prompt. Their technology then generated photo-realistic human faces and speech that’s indistinguishable from real human footage. Given the Hollywood strikes last year, it is clearly a hot-button issue, but it’s a tech that’s here to stay.

Builder.ai

Year Founded: 2016
Founder: Sachin Dev Duggal
Current valuation: $1bn

Builder.ai advertises itself as an AI-powered composable software platform. Its move to democratise software development encouraged investors to deposit their trust in the AI company, translating into a recent $250 million funding round led by the Qatar Investment Authority. The company already has a number of high-profile clients, including the BBC, NBCUniversal, and Pepsi.

Castore

Year Founded: 2015
Founders: Philip Beahon and Thomas Beahon
Current valuation: $1.2bn

British sportswear trailblazer Castore achieved its unicorn status after landing $150 million in a recent funding round. Strategic partnership with renowned sports stars have raised the profile of the company, which has backing from tennis player Andy Murray. It has also secured a number of lucrative kit deals across the sport industry, boasting associations with prominent entities including Newcastle United, Aston Villa, and the McLaren Formula One team.

Taptap Send

Year founded: 2018
Founder: Michael Faye
Current valuation: $1.2bn

The fintech disruptor facilitates affordable money transfers to Africa, Asia, and Latin America, addressing financial inclusion challenges. Founded by a former United Nations development economist, the business model thrives on leveraging foreign exchange for revenue while ensuring customer-friendly policies – there are no commissions or fees for transfers. Currently valued at $1.2bn, the company is well positioned to continue to benefit underserved communities globally who struggle to access affordable financial services.

Oxa

Year Founded: 2014
Founders: Paul Newman and Ingmar Posner
Current valuation: $1.0bn

Backed by $256.6 million in VC funding to date, Oxa is currently in the pole position of self-driving technology. Founded with the vision of enabling any vehicle to be self-driving, Oxa is part of the Tech Nation Future Fifty and has received other prestigious awards like the Barclays Award for Innovation.

Will we see more unicorns emerge in 2024?

The fact that it’s still producing new unicorns shows that the UK’s tech sector has plenty of energy remaining. It’s the third largest in the world after those in the US and China.

Nonetheless, the statistics point towards a slowdown in funding. In 2022, 20 unicorns were formed, indicating a downwards trend from 2021, when 36 unicorns were created.

According to a report by Tech Nation, the drying up of venture capital (VC) money means fledgling tech companies have seen their valuations scaled back. Last year was marked by rising inflation which pushed interest rates up. These conditions made VC proportionately less attractive compared to investing cash into bonds.

Nevertheless, the future isn’t bleak for the UK tech sector. Recent Dealroom data shows the UK is harbouring 34% of Europe’s future unicorns, also known as futurecorns.

The fight to keep UK startups on home turf

Michelle Donelan, the UK’s Technology Secretary, has launched a scaleup policy sprint to prevent UK companies from leaving home turf to migrate to the US.

Donelan wants VC investors to pump an additional £5bn per year into startups by 2030. In her view, this move would allow Britain to become home to half of Europe’s tech unicorns by the turn of the decade.

To keep tech startups on their home turf, UK investors need to create an environment that can compete with the US. Their American counterparts tend to be less risk-averse, with a go-big-or-go-home attitude.

Fighting the allure of the American Dream will be difficult, as conditions in Britain have been tough for those seeking big investment. The downturn in VC capital saw the number of new funds raised drop from 67 in 2022 to 46 in 2023, according to Dealroom data.

Nevertheless, there is reason to remain optimistic. Measures like the Mansion House reforms will channel capital from British pension funds into UK tech companies, and a new VC fellowship scheme will unleash further investment.

While the economic outlook is still not fully mapped out in the coming year, particularly with a potential political shakeup during this year’s general election, the push to revitalise VC funding in the UK spells good signs for futurecorns.