Matt Harney shared research on EBITDA margin, Revenue growth and Rule of 40 for US unicorns.
1. It’s eye opening how much EBITDA margins have been improved in 4-5 quarters for all types of unicorns (something like 20-70 percentage points depending on quartile). It’s another example that software companies can be operated way more efficiently than many larger startups have done in the last 5-10 years.
2. The fact that the median unicorn is below 0 and bottom quartile unicorns are below -50 in a Rule of 40 calculation are signs of weakness. Given how many startups became unicorns with less than $50 million in revenue, this is another example that many of the 1200+ unicorns around the world really are wereicorns.