There was once a time when you only had to look in one direction to witness the birth of a new unicorn – toward California.

For years, it was thought that unicorns – privately held companies valued at more than US$1 billion – were only able to thrive in the fast-paced, growth-at-all-cost environments of Silicon Valley and San Francisco. Early unicorns like Facebook, X (formally known as Twitter) and LinkedIn were characterized by their disruptive technologies that catapulted them to unicorn status in barely the blink of an eye.

Following their explosive growth, however, were often explosive setbacks. Some unicorns’ myopic drive for rapid growth resulted in issues like unhealthy working conditions, unethical business practices and poor corporate governance. These missteps have been immortalized in journalistic coverage as well as entertainment media about companies such as Facebook, Uber, Theranos and WeWork.

The experiences of emerging-market unicorns highlight the importance of balancing ambitious vision with prudent management.

In the wake of these blunders, unicorns have been evolving, and their habitat has been expanding. Billion-dollar startups are springing up in less-established markets, offering fresh perspectives, innovative strategies and valuable lessons that more established startups can learn from. Though they are responsible for their own fair share of mistakes, the experiences of emerging-market unicorns highlight the importance of balancing ambitious vision with prudent management.

The International Monetary Fund reported in 2021 that 20 emerging-market countries now account for an impressive 34 percent of the world’s nominal GDP. Countries like China, India, Brazil, South Africa and several South-East Asian states are gaining influence on the global stage, and so are their unicorns.

But business executives in traditional markets can also gain insights from the successes of unicorns in developing markets.

The Power of Collaboration: Line Man and Wongnai

If the recent challenge by SpaceX founder Elon Musk to face Facebook founder Mark Zuckerberg in a cage fight is any indication, a defining feature of traditional unicorn culture is fierce competition. Facebook’s acquisition of Instagram to keep it out of X’s hands, and even Musk’s recent acquisition of X for ostensibly personal reasons, offer glimpses into the hypercompetitive minds of early tech founders.

But not all unicorns are led by people who are prone to such outward displays of individual ambition. Some, particularly in emerging markets, have demonstrated the ability to form strategic partnerships and collaborations, leveraging collective strength to overcome challenges. A stellar example of this is the alliance between Line Man and Wongnai in Thailand.

Wongnai’s extensive user base now benefits from Line Man’s reliable food delivery services, while Line Man leverages Wongnai’s reviews to guide its customers in selecting the best eateries.

Line Man, a subsidiary of Line Corporation, was primarily a food delivery and logistics service. Wongnai, on the other hand, was a leading restaurant and business review platform in the region. These two companies recognized the potential for synergy and decided to join forces in 2020. Wongnai’s extensive user base now benefits from Line Man’s reliable food delivery services, while Line Man leverages Wongnai’s reviews to guide its customers in selecting the best eateries.

Today, the combined company is valued at around US$1 billion.

This partnership highlights the power of collaboration, an approach that can provide other startups with a fresh perspective on competition and cooperation.

Super-Apps: Gojek and Grab Outmaneuvering Uber

Also in South-East Asia, Gojek and Grab have become iconic unicorns by transforming themselves into super-apps, offering a wide range of services from ride-hailing to food delivery, ecommerce and mobile payments. This strategic diversification allowed the two companies to create ecosystems that seamlessly serve the everyday needs of their users – another model that can teach other aspiring unicorns a thing or two.

Uber, one of the most prominent ride-hailing services globally, entered the South-East Asian market with high hopes, but eventually conceded defeat to Gojek and Grab.

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Gojek, valued at US$10 billion, grew its market share rapidly in Indonesia by signing on a fleet of local motorbike drivers. It eventually diversified by launching a series of super-apps that offer online shopping, financial services and original streaming content, in addition to the original ride-hailing service.

Elsewhere in South-East Asia, Grab carved out a space for its ride-hailing services by seeing opportunities that Uber initially missed. Grab positioned itself as a partner to local taxi drivers, not a competitor, and accepted cash from passengers. Whereas Uber paid its drivers every two weeks, Grab’s local view of the market in South-East Asia prompted the company to pay drivers immediately after each ride, which drivers vastly preferred.

Uber, one of the most prominent ride-hailing services globally, entered the South-East Asian market with high hopes, but eventually conceded defeat to Gojek and Grab.

And while Uber relied on tech staff and investors based in the United States, Grab focused on recruiting local talent and local investors. These local partnerships gave Grab an advantage when seeking government licenses and even scored the company prime pick-up lanes at local hotels.

Now the dominant ride-hailing service in several South-East Asian cities, Grab’s super-app also offers financial services and food deliveries. The company is valued at more than US$12 billion.

In 2018, Uber transferred its assets in eight South-East Asian countries to Grab in exchange for Grab shares, leaving two local unicorns – Grab and Gojek – to battle for dominance in the region. After years of unicorn status, both companies have since gone public.

The TikTok Triumph: ByteDance’s Global Takeover

In the realm of social media, the impact of an emerging-market unicorn on more established platforms played out on smartphone screens across the world.

Since TikTok launched outside China in 2017, multiple other social media platforms have built products modeled on the emerging-market newcomer. Instagram Reels, YouTube Shorts and Snapchat Spotlight are all seen as a response to the short-form, engagement-oriented videos that catapulted TikTok to global success. ByteDance, TikTok’s parent company, is now valued at more than US$220 billion, making it the world’s most valuable unicorn.

In the realm of social media, the impact of an emerging-market unicorn on more established platforms played out on smartphone screens across the world.

The lesson here is that the history of social media has no end. Content will continue to evolve, and the company that sees what users want slightly earlier than its competitors will come out on top, at least until the next transformation arrives.

With TikTok frequently in hot water over allegations of Chinese censorship and inadequate moderation, and with competition continuing between China and powerful rivals, that opportunity may be just around the corner.

cult.fit’s Holistic Wellness Expansion

Take a look at the most popular fitness startups, and you’ll see several companies that specialize in something specific: exercise equipment for Peloton, activity tracking for Strava and gym memberships for Equinox.

The only thing more impressive than building a business as successful as these fitness companies is building one that incorporates elements of all of them. Few startups have come closer to achieving that than India-based unicorn cult.fit, valued at around US$1.5 billion.

The abundance of cult.fit locations serves the dual purpose of catering to local communities as well as crowding out competition.

cult.fit takes a holistic wellness approach, offering services related to exercise, diet, mental health and medical care. Founded on a belief that fitness should be accessible, the company has opened gyms, yoga studios and health clinics across India. Following a model perfected by Starbucks, the abundance of cult.fit locations serves the dual purpose of catering to local communities as well as crowding out competition.

It also fills in some of the gaps left by India’s public health system, offering medical care options to members who are otherwise uninsured.

Further demonstrating its commitment to holistic wellness, in 2022, cult.fit’s parent company introduced a gender-neutral parental leave policy for its thousands of employees.

In an era when personalized health and wellbeing have never been more in demand, cult.fit stands as a bright example of growth and diversification guided by solid values and customer needs.