A startup company, typically backed by venture capital funds, that has received a post-money valuation of at least $1 billion in its last private financing round.

Aileen Lee, formerly of Kleiner Perkins Caufield & Byers and a founder of Cowboy Ventures, coined this term in a November 2, 2013 article in TechCrunch entitled Welcome to the Unicorn Club: Learning from Billion-Dollar Startups. The term was intended to convey the rarity of startup companies achieving a billion-dollar valuation while remaining privately held. However, the number of startups valued at greater than $1 billion dollars has increased substantially since the publication of Ms. Lee's article.

For a discussion of startup venture finance generally, see Practice Note, Startup Venture Finance Overview. For a list of other resources related to startups, see our Startup Company Toolkit.