
Companies That May Be the Next $1B Startups - dankohn1
http://bits.blogs.nytimes.com/2015/08/23/here-are-the-companies-that-may-be-the-next-50-start-up-unicorns/
======
gjolund
I'm writing a filter for my hacker news plugin that removes all references to
"unicorn" from my feed.

~~~
byoung2
You'd miss out on some good articles:
[http://news.nationalgeographic.com/news/2014/11/141112-unico...](http://news.nationalgeographic.com/news/2014/11/141112-unicorn-
deer-slovenia-antlers-science-animals/)

~~~
gjolund
dammit, that was a good one

maybe I should just exclude financial news sites with non technical staff.

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ChuckFrank
A unicorn? I don't see a single one.

I'm currently consulting in the food delivery space, and I can tell you one
thing -- don't believe it. It's certainly possible to create solid local
businesses in the space, but not businesses at a scale that a billion dollar
in valuation demands.

And when you add in the lack of barriers to entry for many of those companies
that are in existing sectors overrun with competitors, I think you can cull
the list by 50% right off the bat.

But I'm sure they are excited to see themselves on this list, as I would be,
even if I knew our fundamentals that got us there were only based upon clearly
unrealistic hopes and prayers for future users and revenue.

And here I was honestly hoping for a real 'unicorn' list. I should have known
better.

~~~
prawn
What are the two biggest issues in food delivery? I imagine it's the
production of food and delivery of it, right? (Funny written out, but I'm sure
you get my point - labour costs.)

Staff to load automated delivery vehicles and the patrons unloading at the
other end will eventually solve one half.

Half decent automated food production could solve the other. A lot of Indian
or Chinese dishes (curries, stir-fries, etc) could surely be automated? Adding
and stirring, portioning out into containers, etc? Could do many pasta dishes
in the same way.

With the right technology, and a limited selection of meals, could you
realistically staff a restaurant delivering out to hundreds each night with
1-2 people? I could see unpack-and-go setups making this industry easy to
scale.

If delivered meals were decent and cheap, I'd get it a few times a week. At
the moment the price puts me off - labour costs are high in Australia.

~~~
richmarr
There seem to be a few different models, maybe worth iterating them (UK
examples).

1) An ordering mechanism for existing delivery services (e.g. JustEat,
HungryHouse). The problem here is the delivery experience is opaque, non-
standard, and sometimes unreliable. If your food is late, you have to call the
restaurant.

2) An ordering and delivery mechanism for existing restaurants (e.g
Deliveroo). I think this is the sweet spot because it controls the entire UX,
is able to offer a reasonable range of food, and is able to list higher-end
restaurants so potentially expands the market for food delivery.

3) All-in-one service (e.g. Deliverance). I think the main problem here is
that they're competing with restaurants, which in my opinion will mean they're
only ever a niche thing.

My guess is that the scalable 21st century businesses will be in Type 2, and
that food delivery (which could eventually be drone-based) and resturants
(some of which may eventually use automation) will remain separate. I think
the delivery & restaurant businesses seem to have different incentives;
restuarants need to optimise for quality & value, and delivery businesses need
to optimise for cost and breadth of choice.

~~~
prawn
That's why I think #3 may win out over restaurants which are sluggish to
react. They'll own the whole process and will be able to optimise exactly what
needs to be optimised. Restaurants have baggage.

If I just want half-decent food, I'm not going to be especially fussy. Speed
and price will be huge factors. A restaurant might not feel comfortable
running a curry-making robot out back whereas a food delivery service will be
all about the result and whatever gets them there.

~~~
richmarr
Sure, I'd split this into two questions then...

Firstly, what happens _before_ all these automations happen. In that world
there's no efficiency advantage over restaurants so a delivery service set up
today has no reason to make its own food (other than to control the whole
process).

Secondly, once we have those robots, restaurant churn is high. A Cornell study
suggested 50% of restaurants fail within 3 years. To me that suggests that the
switch between hand-made and machine-made food could be as rapid as culture
allows. The factors will be things like the capital required to buy those
robots, the cost of paying engineers to maintain them vs the cost of paying
chefs, etc.

TBH, I'm somewhat wary of robots smart enough to cook food equipped with meat
cleavers and rolling pins. I'm not sure the cost structure is the thing I'd
worry about in that business.

~~~
prawn
I'll describe the robot I'm imagining. It requires power and a flat service
(floorspace or bench). It makes an Indian curry in a large quantity and is
managed by one operator who can probably handle 3-4 of these without breaking
a sweat.

It has a large pot, a stirring method, and a few canisters above loaded with
relevant ingredients. These arrive preprepared. Sliced onions, peeled and
quartered potatoes, spice mixes, water, stock, yoghurt, pureed tomato,
whatever. Each canister assesses weight. An app predicts demand (based on day
of week) and instructs the operator as to the quantities required. He tips in
the prepared onions, potatoes, etc - the required weight of each. The robot
doesn't have to peel or chop anything. The ingredients arrive in bulk.

The machine is given the recipe (basically temperature graph and time to
introduce each canister. Oil, stir, stir, onion, stir for x minutes, potatoes,
protein and so on. Imagine a Thermomix that you can preload with ingredients.

The operator has loaded up one machine, then does another, and another. While
waiting, he starts to prepare packaging. As machines finish and switch to
warming mode, he serves portions to packages and loads the delivery method
which has backed up to an open window/door nearby. The vehicle is like a post
office mailbox wall with a warming method - it drives up to a house indicating
the order is in a particular box. The recipient grabs their order and a server
is notified.

The operator back in the "restaurant" wipes down the machines as required. The
app calculating servings auto-places orders for replacement ingredients based
on what was used.

If you have a sole driver, most of that could be built and solved now. We
could make a set of warming drawers that sideload into a stock van. We could
build an apparatus that sits above a giant Thermomix or KitchenAid-type
appliance.

I think the keys to it all are not trying to solve the most difficult bits of
each equation. IMO, those are: robots that can prepare ingredients, delivery
from street to the front door, and a menu that includes things that are
difficult to produce and serve en masse. This approach could still handle
countless stir-fries, curries, soups, and a few salads (a Thermomix makes a
half-decent coleslaw in 3 seconds - we do it all the time).

------
imh
Can we please stop calling billion dollar companies startups?

~~~
jkestner
Not until their P/E first returns a positive number.

~~~
imh
Does that make twitter, amazon, and tesla still startups? I swear I'm not
cherrypicking data. Those, plus google and facebook, are the first big
companies I thought to look up P/E on. Public startup seems like a
contradiction.

[http://www.nasdaq.com/symbol/twtr/pe-
ratio](http://www.nasdaq.com/symbol/twtr/pe-ratio)

[http://www.nasdaq.com/symbol/amzn/pe-
ratio](http://www.nasdaq.com/symbol/amzn/pe-ratio)

[http://www.nasdaq.com/symbol/tsla/pe-
ratio](http://www.nasdaq.com/symbol/tsla/pe-ratio)

I agree company size is a bad metric, but there's something weird about
calling some of these huge companies with thousands of employees startups (the
unicorns, I mean, not amazon and twitter).

~~~
jkestner
Was tongue-in-cheek, but that's why I used the word "first". All three have
turned a quarterly profit at some point (Twitter only if you discount losses
from stock-based compensation).

Twitter and Tesla have not yet turned on the money spigot, so you could argue
they're still startups. Amazon is a grown-ass business that can turn the
spigot on anytime it wants to impress investors.

~~~
imh
Ah, I couldn't tell how you meant it. Poe's law and all that.

------
ams6110
Taboola is already in my /etc/hosts file.

~~~
jodrellblank
Really? Aren't you missing out on how people are buying iPhones for $1?

Taboola is a billion dollar business with MULTIPLE investment rounds over a
hundred million dollars?

I am angry about it.

------
arthur_debert
It's surprising how much of it relates to food delivery (the largest group, in
fact).

Wrote my take at how the it's distributed here
[https://medium.com/@arthurdebert/2abb1df33f6d](https://medium.com/@arthurdebert/2abb1df33f6d)

------
ftrflyr
Vertical farming is going to be huge.

------
mrdrozdov
By Location:

    
    
      New York      - 8
      San Francisco - 16
      Rest of CA    - 12

~~~
binxbolling
Why are you only tallying NY and CA?

~~~
jkestner

      4 - China
      2 - Boston
      2 - Chicago
      2 - India
      1 - Berlin
      1 - London
      1 - South Africa
      1 - Virginia

------
11thEarlOfMar
YC Firms:

AirWare

CoinBase

DoorDash

Mixpanel

Optimizely

ZenPayroll

~~~
DarthMader
They're missing Flexport from this list

------
iribe
Out of all of these, only one stands out as a sure fire success: sonos.

------
joshu
I think I am an early investor in five of these. Not incredibly fond of the
term "unicorn" though.

~~~
gjolund
A lot of the tech community is "magic" to the uninformed and uneducated. I
think the term "unicorn" is a play on this sentiment.

There is nothing mythical about well funded startups having high valuations.

You don't stumble into one while galavanting through an enchanted forest.

You can't drink the blood of a successful SV CEO to prolong your life.

If you say "unicorn" in reference to tech startups I immediately assume you
are a trendy idiot who's vocabulary doesn't extend past memes and buzzwords.

I've worked at several "unicorns", we all think you sound dumb.

edit: "you" is directed at the financial news community.

~~~
furyofantares
Well, you don't do any of those things with unicorns, either

~~~
gjolund
apparently you've never watched / read harry potter

------
tsieling
50!

If you're going to go listicle, go large.

------
simonebrunozzi
I believe that Betterment is already past the 1B dollar valuation. Am I wrong?

------
farnsworth
It would be nice to see a list like this from 4 years ago.

------
somberi
Thumbtack and Sonos?

------
qCOVET
So what would you call a Startup that would hit a trillion dollar valuation ?
- May be we invent the name here on HN .

~~~
gjolund
A multi-national corporation.

or

The Catholic Church.
[http://www.economist.com/node/21560536](http://www.economist.com/node/21560536)

