The Peter (Pan) Principle: Why Some Unicorns Never Fully Grow Up

Growing from a unicorn into a household name used to take more time. Companies such as Apple, Costco, and Microsoft, founded in the 1970s and 1980s, often took two decades or more to reach what we call scale insurgency. That means they grew from start-ups into enormous companies while keeping their insurgent mindset—their Founder’s Mentality—and avoiding the complacency that too often causes giant incumbents to stall out.

Companies founded in the decade or so after 1990, such as Amazon or Google-parent Alphabet, grew faster, achieving scale insurgency in as little as 10–15 years. And many of today’s newest scale insurgents, companies such as Facebook-parent Meta or China’s Meituan, achieved $10 billion or more in revenue in as little as 10 years, fueled by Internet penetration and capital availability.

However, this acceleration has stalled out in the US. While Chinese companies have continued to scale at pace, the only US company other than Meta to cross the scale insurgency threshold ($10 billion in revenue, $1 billion in cash) over the past 20 years is Uber, which took 14 years to get there. 

Where are the other US scale insurgents? Tens of thousands of start-ups were funded, and thousands attracted talent and raised the capital to be anointed unicorns. Yet, our analysis is that even among the emerging insurgents that have crossed the $1 billion revenue threshold, less than 25% are clearly on track to become scale insurgents.

Increasingly, it appears that the robust capital-raising environment that created so many unicorns may have undermined the business building skills and Founder’s Mentality required to build scale insurgents.

Read more

Where Are the Unicorns That Can Fly on Their Own?

Billion-dollar start-ups now number in the thousands, but just a handful are profitable at scale.