A Tale of Two Unicorn Generations

Value creation in technology is increasingly concentrated in private markets.

Consider this: the five largest private technology companies—Anthropic, OpenAI, Databricks, Stripe, and Waymo—have a combined valuation exceeding the aggregate value of US technology IPOs over the decade ending in 2025. Meanwhile, the 75th-percentile valuation of technology IPOs is approximately $3.5B, almost insignificant compared with today’s largest private unicorns.

But behind these extraordinary valuations, something interesting is happening: the unicorn population is splitting into two generations.

Around half of the approximately 1,000 U.S. unicorns achieved unicorn status during 2021–2022, at the peak of the Zero Interest Rate Policy (ZIRP) era, when abundant liquidity and exceptionally low interest rates propelled private valuations to unprecedented levels.

Today, these mature companies coexist with a new generation of younger, rapidly growing AI startups.

We are witnessing two very different generations of unicorns: 

* The ZIRP generation (pre-2022): Mature businesses, generally slower growth, improving profitability, and often substantial financial runway

* The AI generation (2023–2026): Explosive growth, high cash burn, and business models still being tested for long-term sustainability

The new generation is also reaching unicorn status much faster. The median age of newly minted unicorns has fallen by approximately 37% since 2019, from more than seven years to around four.

Our Fabrica Ventures Fund I (vintage 2020) belongs to the ZIRP generation.

As we can attest from our portfolio, these companies are evolving into more mature businesses through four parallel initiatives:

* Scaling and expanding: Growing operations, geographic reach, and customer bases

* Consolidating and partnering: Acquiring businesses, absorbing competitors’ customers, and forming strategic partnerships

* Innovating and adapting: Enhancing products, embedding AI, and deploying autonomous agents

* Preparing for liquidity: Advancing toward potential IPOs, strategic acquisitions, and other exit opportunities

These are no longer startups pursuing growth at any cost. They are increasingly established businesses adapting to a different financial and technological environment.

Conclusion

Our own funds illustrate the importance of investment timing.

Fabrica Ventures Fund I (vintage 2020) has performed relatively well, ranking among the top 15% in DPI according to Carta’s benchmarks, having already returned 27% of paid-in capital to LPs. Yet that performance pales in comparison with Fabrica Ventures Fund II (vintage 2023), which has already returned 68% of paid-in capital to LPs.

Two funds. Two vintages. Two very different market environments.

This is precisely why institutional investors diversify their venture capital commitments across vintages. Timing matters — not only when investing in individual companies, but also when entering an entire generation of technology businesses.

And it is one reason we are particularly bullish about Fabrica Ventures Fund III (vintage 2027). We believe the next wave of value creation will come from AI InfraTech and Physical AI. Our next vintage aims to capture what comes next.