Tech Unicorns in Australia (Updated 2024)

Aussies are a pretty tech-savvy bunch, and this business is key to the country's economy.

Australia has created its fair share of tech unicorns in recent years. But what exactly does that mean?

The term "tech unicorn" is thought to have first been coined by a venture capitalist named Aileen Lee in California back in 2013. It refers to a privately held startup company whose value exceeds $1 billion.

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There are more than 600 unicorns that have gained entry into this relatively exclusive club, including the likes of Reddit, Bytedance, SpaceX, Stripe, SHEIN, Ola Cabs and Patreon.

Australia's tech unicorn landscape

Australia has a reputation for being home to small businesses and startups. Notable examples of Aussie ingenuity include Google Maps, black box flight recorders and cochlear implants. However, while the country has produced successful small to medium enterprises like Atlassian (NASDAQ:TEAM) and buy now, pay later business Zip (ASX:ZIP), experts believe a lack of resources is preventing the country from producing more internationally successful technology companies.

In fact, at time of publication, a list of more than 1,200 tech unicorns included just nine from Australia. Leaders in the space are the US with roughly 54 percent of the list and China with 14 percent, followed by India with nearly 6 percent and the UK with a bit more than 4 percent.

Given that Australia has the 13th largest economy globally, with 2,589,873 actively trading businesses in the nation's economy as of June 2023, there is potential to grow.

What are Australia's noteworthy tech unicorns?

Although Australia is a relatively small market compared to North America and Europe, it currently has eight tech unicorns, as per the CB Insights list mentioned above. They are:

• Canva — A DIY graphic design app created by Melanie Perkins, Cliff Obrecht and Cameron Adams; it debuted as a tech unicorn in January 2018. At the time of publication, Canva was an impressive seventh most valuable on the CB Insights list with a market worth of AU$25.4 billion. Select investors in the company include Sequoia Capital China, Blackbird Ventures and Matrix Partners.

• Airwallex — Currently based in Sydney, Airwallex was founded in Melbourne and became the fastest Aussie startup to achieve unicorn status when it was added to the list in March 2019. Valued at AU$5.5 billion, it offers competition to the big banks with cheaper solutions for international payments. Select investors include DST Global, Sequoia Capital China and Tencent Holdings (OTC Pink:TCTZF,HKEX:0700).

• Immutable — With a market worth of AU$2.5 billion, Sydney-based fintech business Immutable Holdings is focused on asset ownership and commerce in the digital gaming world. It utilises ImmutableX, its NFT minting and trading platform. Its investors include Fabric Ventures, AirTree Ventures and Temasek.

• Go1 — Go1 has a market worth of AU$2 billion and operates in the online learning and education sector. It’s based in Brisbane and its investors include Y Combinator, M12 and SEEK.

• SafetyCulture — Founded in Townsville by CEO Luke Anear, SafetyCulture has provided occupational health and safety and compliance documents since 2004. The company has 65,000 customers performing 600 million checks per year and a valuation of AU$1.7 billion. Blackbird Ventures, IndexVentures and Tiger Global Management are some investors in the company.
• Employment Hero — This tech firm offers online human resources software for enterprises, with functions such as payroll, employee benefits and retirement, employment contracts, accounting, etc. The company has a valuation of AU$1.37 billion, and its biggest backers are OneVentures, AirTree Ventures, and AMP New Ventures.

• Culture Amp — Culture Amp describes itself as an “employee experience platform,” helping over 6,000 companies around the world increase employee retention and engagement. Its customers include the aforementioned Canva, as well as Etsy (NASDAQ:ETSY), Oracle (NYSE:ORCL) and McDonald’s (NYSE:MCD). Culture Amp has a valuation of AU$1.5 billion and its select investors include Blackbird Ventures, IndexVentures and Felicis Ventures.

• LinkTree — LinkTree has headquarters in both Melbourne and Sydney. It operates as a landing page where a company or individual can insert all of their relevant social media links, rather than having to link to them all individually on their own page. It has a market value of AU$1.3 billion and its investors include AirTree Ventures, Insight Partners and Index Ventures.

• Pet Circle — Finally, Pet Circle, added to the list in December of 2021, is the largest online pet shop in Australia. It has a market value of AU$1 billion and its select investors include Prysm Capital, Baillie Gifford & Co. and TDM Growth Partners.

What about Australia's tech "soonicorns"?

Beyond the tech unicorns mentioned above, there are a number of Aussie startups worth keeping an eye on. Dubbed "emerging unicorns" by data business Crunchbase, these businesses are on their way to full unicorn status. Some examples include:

• Zeller — One of Australia’s fastest growing fintech enterprises, the company provides a payments and financial services solution that allows businesses to accept and make payments. Its leading investor is global venture capital firm Headline.

• Cover Genius — This insuretech firm offers an insurance distribution platform designed to protect e-commerce and travel customers. European VC Dawn Capital is one the company’s biggest investors.

• Dovetail — A custom IT solutions company that provides cloud-based user research and customer feedback software. Its leading investor is American investment firm Accel, which has also provided capital to Meta Platforms (NASDAQ:META), Slack and Dropbox (NASDAQ:DBX).

How to identify potential Australian tech unicorns?

Tech unicorns tend to fall into four major categories: fintech, ecommerce, artificial intelligence/robotics and health. It is difficult to predict when a new one will emerge, but investors can keep an ear to the ground by researching media coverage and Australian Securities and Investments Commission filings.

Unicorns can also create a new niche. While some seek to solve an existing problem, many are the first to market. Looking at businesses with the potential rapid growth and analysing the rate at which a business brings in new users, can be useful — high growth is often the path to a high valuation.

What is the future for tech unicorns in Australia?

Australia is still lacking the right "ecosystem" for propelling big startups, according to a report from Startup Genome, which tracks the top 40 cities in a global startup ecosystem ranking.

Only two Australian cities even made the list — Sydney ranked the highest at 20th, with Melbourne trailing at 36th. Sydney is Oceania’s biggest ecosystem, according to Genome, with the majority of Australia’s tech startups based in the city. Time will tell whether a post-pandemic Australia strives for new heights or remains low on the totem pole of tech unicorns.

This is an updated version of an article first published by the Investing News Network in 2021.

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Securities Disclosure: I, Melissa Pistilli, hold no direct investment interest in any company mentioned in this article.

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