🦄Unicorn Market Size

Even if there are unions or regions, any venture starts from the country market, where population and buying power are just two primary metrics that must be considered when evaluating the market size.

Speaking about countries, we often say, "It's a big market" or "It's a small market."

A big enough local market size for high buying power is 33M, for mid-power is 48M, and for low — 98 million people.

Access and browse the data: https://airtable.com/appeT0xc9SYXOKkqO/shrwrP5W7VsnOlbjJ

On occasion chat, I dropped the opinion that the Vietnamese 100M population is a minimum required for a startup without expanding abroad. And I was asked to explain then. I did a quick research and want to share my findings.

Conducting research

I aimed for simplicity and speed. I compiled a list of countries with at least one unicorn, their populations, and GDP per capita. GDP/cap is the most straightforward metric of buying power and user behavior culture in adopting digital products.

I excluded countries with populations less than 10 million, as unicorns from these countries likely utilize their legal jurisdictions or engage extensively in international markets. I also omitted China, India, and the USA due to their population and economic anomalies compared to others. This left 30 countries on the list, with GDP/cap ranging from $2K to $65K.

I categorized countries with a GDP/cap of less than $10K as having low buying power. Those with a GDP/cap between $10K and $40K were considered medium buying power, and countries above $40K were classified as having high buying power.

Disclaimers

It's important to note that unicorns are not the sole metric to consider. For instance, India has one unicorn per 20 million people, while Japan has one per 18 million, yet their GDP/cap differs by 17 times. The unicorn metric is influenced by local business culture and the polarization of business sizes.

Italy and France have similar population sizes and GDP/cap, yet France boasts 25 unicorns compared to Italy's 2. This discrepancy indicates other underlying factors at play.

In my quick research, I did not rely on the number of unicorns as a primary metric. Instead, I used the presence of a unicorn as a qualification for inclusion in the list to examine the correlation between population size and development status.

Conclusion

When considering the size of a local market, this data can generally be relied upon. The further the local population is from the median, the more challenging it seems to build a unicorn-value business relying solely on a single country. Suppose you're launching a business or investing with the expectation of reaching high valuations. In that case, it's crucial to understand that countries with populations above 10 million may only serve as a launchpad, making it essential to plan for expansion from the start.

Similarly, suppose you're starting in an emerging market with a population of around 50 million. In that case, it may be challenging to reach unicorn size without expanding, but this doesn't mean the business won't be profitable.

However, for a deeper analysis, you must consider various factors such as culture, behavior, competitive landscape, etc.

Feel free to share your thoughts and views on defining a sufficient country market size. I welcome any feedback and will update the article with valuable insights.

Data sources

Population and GDP per capita from the World Bank, 2022

Unicorns from CB Insights, 2023