What does it take to be part of the elite Wall Street Journal (WSJ) Billion Dollar Startup Club? Just your own startup—and at least $1 billion in net worth from it. This is the kind of club every entrepreneur wants to join, yet very few will ever succeed. I'm currently working on my online invoicing service hoping that I can get there. There are no applications, no membership dues, and no hazing rituals. Instead, the WSJ keeps a close eye on startups, entrepreneurs and finances to identify which startups breach the one billion dollar mark. So far, on a worldwide scale, there are only 73. However, there’s plenty of room for more.
Making $1 billion is an extremely lofty goal and one that most entrepreneurs (or anyone in general) will never reach. The Club itself is only a little over one year old, launching in January 2014. As of February 2015, the most lucrative startup on the list is Xioami valued at $46 billion and the least lucrative is comprised of 21 startups valued at a paltry $1 billion each. There are others who “exited” the program by no longer being valued at a minimum of $1 billion.
Allow Me to Introduce You…
Who are these startups, exactly? There are 50 based in the US, eight in China and four in India. Specifically, there are 20 in San Francisco, five in New York, four in Palo Alto and four in Beijing (apparently, WSJ didn’t want to dig deep into the metros of India). The top industries are Software at 23 companies, e-commerce at 15, consumer internet at 14, and financial services at six. The top investors are Sequoia Capital which invested in 17 of these companies, Kleiner Perkins at 14, Tiger Global at 12, and T. Lowe Price along with Andreessen Horowitz at 11 each.
Want to know more? Here’s your introduction to a few of them in order of ranking:
1. Xioami
Founded by eight people in June 2010, this privately owned Chinese electronics company is the third biggest smartphone distributor in the world. The company also develops, designs and sells a number of electronics including phones and mobile apps. The first Xiaomi smartphone was released in 2011. The CEO (and co-founder) Lei Jun is the 23rd richest person in China as reported by Forbes. In 2014, the 5,000 employee-strong company sold more than 60 million smartphones.
2. Uber
Yes, the transportation company/app you know and love is the second wealthiest startup in the world. You probably know Uber, headquartered in San Francisco and founded by Garrett Camp and Travis Kalanick in 2009. Today, Uber is in 53 countries, 200 cities, and has served as a model for imitation apps and services. It’s estimated to be worth $41.2 billion.
3. Palantir
This startup was co-founded by a team of five in 2003. A private American software/services company, the Palantir specialty is data analysis. The first clients were federal agencies, but it now serves government clients at all levels. The Palantir Gotham shot the startup to fame by offering counter-terrorism analysts, then it followed up with Palantir Metropolist designed for banks, financial firms and hedge funds. It’s estimated that Palantir is worth $15 billion.
Other notable entries that are well known include Snapchat, Drop Box, Square, Pinterest, AirBnB, Spotify, DocuSign, Instacart, JustFab and Credit Karma. It just goes to show you that you never know who a billionaire is—or what kind of idea can lead to a billion dollar startup.