In January 2017, the U.S. online video startup Zoom Video Communications closed a $100 million funding round lead by Sequoia Capital. The Series D funding round was completed at a valuation of $1 billion, making Zoom the latest entrant to the prestigious, if fictitious, “Unicorn Club” of startups reaching a valuation of $1 billion or higher before going public.
Once upon a time, only very few startups managed to reach that milestone - hence the term unicorn - but in recent years it has become more and more common for young tech companies to reach such lofty valuations. According to The Wall Street Journal there are currently 154 startups with billion-dollar valuations, up from just 45 three years ago.
After the number of unicorns had increased sharply through 2014 and 2015, the market cooled off significantly in 2016. Over the past 12 months, no more than 10 startups entered the unicorn club, mirroring a general slowdown in venture capital funding throughout 2016.