KUALA LUMPUR (Aug 4): New unicorn counts around the world fell 80% year-on-year (y-o-y) in the first half of 2023 (1H2023), with just 44 companies earning that title — a far cry from the 251 companies that joined the Unicorn Board in 1H2022 and the 295 in 1H2021.

In a report on Thursday (Aug 3), Crunchbase, which tracks trends, investments and news of global companies from start-ups to the Fortune 1000, said the decline in new unicorns underscores the precipitous decline in late-stage financings in the past 12 months.

It said the US remains the largest market for new unicorns.

Of this year’s new unicorn companies, half are headquartered in the US, a quarter are in China, and six are based in Europe, the firm said.

Crunchbase said for the new batch of unicorns, the leading sector was — no surprise — AI.

It said companies in the sector make up 25% of new unicorns this year.

Corporate investors have been actively investing in AI.

Nvidia and its venture arm NVentures combined, have participated in five investments in newly minted AI unicorn companies this year.

Another corporate investor, Salesforce Ventures, participated in funding three of these AI unicorn companies in 2023.

Crunchbase said consistent investors include Index Ventures in Cohere and Raisin; Google Ventures in Kindbody and Typeface; Andreessen in KoBold Metal and Replit; A.CapitalVentures in Character.ai; Coatue in Our Next Energy; MMC Ventures in Synthesia, Frees Fund in Bluepha; Aqua Spark in eFishery; AlbionVC and HSBC in Quantexa; and Valor Equity Partners and S3 Ventures in Atmosphere.

These investors stand to gain the most from potential future exits, as they continue to invest to maintain their equity stakes in some of their most highly valued companies, it said.

Crunchbase said the top investor leading rounds for new unicorn startups so far this year is a relatively small, under-the-radar investor based in Berlin.

It said early-stage investment firm b2venture was the most active investor in new unicorn startups in the first half of 2023, Crunchbase data shows.

The firm participated in nine funding rounds across three new unicorn startups — a significant portion of the only 44 total new unicorns minted in 1H2023.

b2venture is followed by multistage venture firms Index Ventures, Google Ventures and Andreessen Horowitz — all tied for the rank of second-most active, with eight investments each in the new unicorns that joined The Crunchbase Unicorn Board in the first half of 2023.

This lineup looks very different from the firms that amassed a huge portfolio of unicorn companies in the last few years — namely Tiger Global, Accel, Andreessen Horowitz and Sequoia.

Of these four firms, Andreessen Horowitz still made the leading 1H2023 list, with three portfolio companies and eight investments in this batch.

The Crunchbase Unicorn Board is a curated list that includes private unicorn companies with post-money valuations of US$1 billion or more, and is based on Crunchbase data. New companies are added to the Unicorn Board, as they reach the US$1 billion valuation mark as part of a funding round.

The unicorn board does not reflect internal company valuations — such as those set via a 409a process for employee stock options — as these differ from, and are more likely to be lower than, a priced funding round. We also do not adjust valuations based on investor writedowns, which change quarterly, as different investors will not value the same company consistently within the same quarter.