Unicorns: Leading and reshaping the new economic landscape in China

PwC China Unicorn CEO Survey 2020

The pandemic supercharged corners of the start-up ecosystem and new economy, blooding many new unicorns in remote working, online education, live streaming and healthcare. Amid the unprecedented challenges arising from the COVID-19 outbreak in 2020, unicorns in China showed remarkable resilience and striking ingenuity to turn the economic challenge of a lifetime into an opportunity.

The headline takeaway is that the impact of COVID-19 on Chinese unicorns has been limited. This is because many of them have their roots in the digital economy, which thrived during the pandemic as consumers embraced a more digital lifestyle. Even before the outbreak, the impact of the digital economy on people’s live in China – from how they eat, shop and travel to their employment, education and entertainment – has been profound. Much of this new economic dynamism has been contributed by unicorns – many of which are now competing internationally in sectors ranging from transportation to media.

PwC’s China Unicorn CEO Survey has been updated for the third consecutive year to provide for the first time a nuanced understanding of the Chinese unicorn sector in the post-pandemic landscape. It sheds light on how unicorns responded to the effects of the outbreak and the learnings they have carried forward – drawing upon questionnaire responses from more than 100 executives at unicorns across 11 industry sectors, in-depth face-to-face interviews with more than 20 executives, and qualitative insights from renowned venture investors.

unicorn ceo survey 2020

Turning the corner

The nine trends we observed from our latest China Unicorn CEO Survey coalesce into four distinct themes. As our research makes clear, the Chinese economy’s V-shaped recovery last year helped unicorns blunt the impact of the COVID-19 pandemic. With the tailwind of a huge and fast-changing domestic market behind them, unicorn companies are generally optimistic of growth prospects in 2021. This is influencing their decision-making in myriad aspects, from where they prefer to tap capital markets for funding, to implement their business strategies for meeting new consumer dynamics in today’s increasingly digital economy.

unicorn ceo survey 2021

Top 9 unicorn trends for 2020

All enterprises in China – including unicorns

The relative calm over COVID-19’s impact

The desire among unicorns to expand overseas has undeniably dimmed amid the COVID-19

Even as they reorientate for the post-pandemic era

New infrastructure development plans rolled out one after another in 2020

While many Chinese unicorns are surrounded by a halo of venture capital

Throughout the research undertaken for this survey

Many aspects of business joined hands during the COVID-19

China’s unicorns have shaped, and will continue to shape

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unicorn ceo survey 2021

Technological advancement has been a mainstay of China’s economic growth so it comes as no surprise that technology-driven companies account for a high proportion of Chinese unicorns. For many of them, the public health crisis was an opportunity to develop and roll out innovative new technologies, or to fast-forward their digital transformation. Technology remained a top priority for the unicorns we surveyed and many of them see additional opportunities in China’s extensive rollout of new infrastructure development plan.

Around the world, unicorns – including those in China – are courted by venture investors. But to succeed in the business world, they must be able to gain profitability and create real commercial value. The pandemic appears to have sharpened unicorns’ understanding of this; their focus has shifted towards achieving profitability, cost control and performance improvement, focusing on long-term business operations. And as China’s market matures, unicorns are reorientating their business strategies with a greater emphasis on sustainable long-term growth.

Contact us

Stephen Wong

Stephen Wong

Entrepreneurial and Private Business Leader, PwC China

Tel: +[86] (10) 6533 2255

Wilson Chow

Wilson Chow

China Artificial Intelligence Leader and Global Technology, Media and Telecommunications Industry Leader, PwC China

Tel: + [86] (755) 8261 8886

Elton Huang

Elton Huang

China Tax Lead Partner, Central China Markets Leader, Shanghai Office Lead Partner, PwC China

Tel: +[86] (21) 2323 3029

Jianbin Gao

Jianbin Gao

Mainland China TMT Leader, PwC China

Tel: +[86] (21) 2323 3362

Yuqing Guo

Yuqing Guo

China Centre of Excellence Partner , PwC China

Tel: [86] (21) 2323 2655

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