I’ve never seen a flying horned horse with magical powers bouncing around. To my knowledge, no one has. If you have, let’s talk, I’d like to know where you find your mushrooms.
For most of their existence, unicorns lived in fantasy books, cartoon shows, and as stuffed animals in children's rooms. After the Great Recession, however, these mythical creatures began appearing in places like San Francisco, New York City, Boston, Beijing, Stockholm, and Singapore. At first the sightings were rare, but as the unicorn craze gained momentum (and cult like followers), unicorn encounters became almost common place. By the early 2020’s, there were over a 1,000 known unicorn sightings around the world.
These unicorns, of course, weren't the mythical creatures from our childhoods—they were the hottest startups, strutting through the halls of influential venture capital firms with their billion-dollar-plus valuations. The moniker for these fast-growing companies came to prominence a number of years after the 2008 financial collapse, with Aileen Lee’s 2013 TechCrunch article titled, Welcome to the Unicorn Club: Learning From Billion-Dollar Startups, being largely credited with bringing the term into the startup zeitgeist.
The unicorn craze sent deep ripples through entrepreneurial ecosystems. Venture capital flowed into bloated deals as co-working spaces buzzed with the clack of keyboards and the echoes of epic ping-pong battles. Adderall sales were through the roof. Businesses were seemingly created solely on valuation potential versus value creation. And a new trend of human behaviors emerged—so bizarre that only satire could fully capture the absurdity of it (see the season 1 finale of the HBO show Silicon Valley, “Optimal Tip-to-Tip Efficiency”, as exhibit A).
The rules of the world were being rewritten in real time. Suddenly, it was totally normal to hop into a stranger’s car at 2am—or walk into someone else’s home with a five-star rating and no fear of being shot or arrested. The unicorns of that era became ubiquitous products and household names—Airbnb, Doordash, Snapchat, Uber, Instagram, Pinterest, to name a few. “Fail fast” and “move quick and break shit” became the new “Live, Laugh, Love”. You may not have been riding amongst the clouds filled with unicorns, but if you were a part of an early-stage company, the promise of wealth, sex, champagne and cocaine (hi, Prof G) that awaited you on the other side of the words “exit” or “acquisition” put that unmistakable glint in your eyes. Times were good and the road ahead looked gilded.
But, things weren’t quite what they seemed.
Fundamentals didn’t matter
The valuations of many of these businesses seemed almost as mythical as the unicorn itself. For many companies, revenue wasn’t a word in their dictionary. Their game plan was simple—gain the user, capture their full attention, sort the rest (i.e. the fundamentals) out later. In many cases this strategy worked—see the social media darlings. They burned through millions in cash to build sexy—and often addictive—products and acquire millions of users, paid their teams handsomely, and then, many years later, figured out how to make money, which came largely in the form of monetizing our data and selling ads.
The problem was that this game plan soon became the norm. Every Tom, Dick and Sally based their pitch deck around this concept. The ubiquitous hockey stick slide replaced revenue with user growth. Unit economics didn’t matter. Margins weren’t a thing. The modus operandi was build quick, gain a shit-load of users, and weave an intoxicating story—everything else would follow.
Cult-of-personalities
This was an era of founder-worship, when CEOs became the rockstars of the business world. They swaggered through conferences in black t-shirts and jeans, micro-dosed psychedelics for “creative inspiration,” and wielded phrases like “disrupt” and “innovate” with no shame. They were the human embodiment of their companies, equal parts visionary and cult leader, convincing investors and employees alike that they weren’t just building companies, but rewriting the future of humanity.
And the world ate it up. Whether it was the relentless optimism of Elon Musk promising Martian colonies or the messianic intensity of Elizabeth Holmes pitching a blood-testing revolution with a dead-eyed stare, these figures had a knack for spinning improbable futures into billion-dollar valuations. The media fanned the flames, churning out profiles that read like the hero’s journey of a Greek demigod. The more eccentric the founder, the higher the valuation.
Costumes on Hobby Horses
For all their mythical hype, these unicorns weren’t as powerful or economically transformative as they were made out to be. Sure, they changed how we communicate at work, have food delivered to our homes, and share memes, but they didn’t exactly reinvent the economic wheel. And yes they minted new classes of eight to ten figured worth humans, but the distribution of this new wealth was highly concentrated and often flowed out of the communities that housed, built and supported these companies. In reality, their impact on GDP was more sugar rush than structural shift—intense, immediate, but ultimately fleeting.
For one, they never really made a dent in the productivity puzzle. In the 2010s, U.S. labor productivity grew at its slowest rate since World War II, despite the explosion of unicorn-led tech. The promise of these startups—faster, leaner, more efficient systems that would streamline life and business—largely failed to materialize. We got more ride-hailing apps, but not more efficient transportation systems. We got food delivery, but our diets remain as chaotic as ever.
Worse, many of these companies thrived on exploiting labor loopholes rather than genuine technological breakthroughs. They turned their workers into contractors, sidestepping pesky things like benefits and minimum wage protections. They perfected the art of externalizing costs, letting their gig workers shoulder the burden of car maintenance, fuel, and health insurance, while founders and early investors cashed out on IPO day.
And then there’s the elephant in the room: profitability. For every Amazon that eventually figured out how to turn a profit, there are dozens of unicorns still fumbling with the concept. Many are locked in a desperate arms race to grow at all costs, burning billions in the process, with no clear path to the black. Investors started to notice. Valuations came back down to Earth. And the once-boundless pastures of Silicon Valley, filled with what appeared to be frolicking unicorns, turned out to be over grazed fields full of donkeys dressed in unicorn onesies.
The Real Economic Power of Small Business
While unicorns grabbed headlines and tech billionaires graced magazine covers, the real backbone of the economy continued to be small businesses. The coffee shops, machine shops, plumbers, brewers, corner stores, and countless other local businesses that form the fabric of our communities might not have billion-dollar valuations, but they create something far more important—real, tangible value.
Small businesses employ nearly half of the American workforce and generate over 40% of U.S. GDP. They keep dollars circulating locally, supporting everything from little league teams to Main Street parades. They innovate at a grassroots level, solving real problems for real people, not just optimizing algorithms to serve you more ads. And, perhaps most importantly, they build wealth in communities, creating a sense of ownership and pride that no venture-backed app can replicate.
Even during economic downturns, small businesses have shown resilience. They don’t have multi-million-dollar war chests to burn, so they make up for it with grit and creativity. And unlike unicorns that rise and fall on the whims of venture capitalists, small businesses tend to stick around, weathering economic storms and coming out the other side a bit battered, but still standing.
It’s easy to get swept up in the allure of the next big thing, the sexy startup with a slick pitch deck and a crazy valuation. But real, lasting economic power comes from businesses that know their customers by name, that hire locally, and that play an integral role in their communities. They’re not chasing billion-dollar valuations—they’re chasing rent payments, payroll, and a chance to pass something meaningful on to the next generation.
Back to Basics: Building Real Economic Value
It’s time we snap out of the unicorn trance. The past decade has shown us the dangers of fixating on fast growth, flashy valuations, and the relentless pursuit of the next big thing. We’ve seen what happens when the narrative is driven by inflated metrics and high-stakes hype—companies rise quickly, burn hot, and often crash just as spectacularly.
Instead, we need to refocus on the basics: building businesses that generate real, sustainable value. Companies that turn a profit, pay decent wages, and reinvest in their communities. Businesses that care more about customer loyalty than quarterly growth hacks. The kind that can weather economic downturns because they’re not propped up by speculative capital, but built on solid fundamentals.
The truth is, not every business needs to be a unicorn. In fact, most shouldn’t be. The vast majority of businesses will never have billion-dollar valuations, and that’s okay. They can still be wildly successful by every other metric—profitable, impactful, respected, and enduring. They can provide stable jobs, support local economies, and create lasting wealth.
This isn’t just a moral argument, either. It’s a practical one. Building businesses with real value creates a more resilient economy, one that isn’t focused solely on extraction but on value creation and community impact. It’s about shifting our focus from “disruption” to durability, from breakneck growth to long-term impact.
So, maybe it’s time we recalibrate our expectations. Moonshots matter—we need bold entrepreneurs willing to shoot for the stars and attempt the impossible. These visionary efforts can shift paradigms, reshape industries, and inspire the rest of us. But they should be the exception, not the expectation. Most businesses shouldn’t aim to be rocket ships—they should aim to be reliable engines of value, rooted in reality, solving real problems. Because at the end of the day, unicorns aren’t real.