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We all know that Malaysia hasn’t had the best luck when it comes to growing or attracting unicorns compared to our other regional neighbours like Singapore, Indonesia, and the Philippines. 

To recap from our previous article on unicorns, unicorns are hard to build in Malaysia for a variety of reasons, such as our smaller population, a lower standard of living compared to countries with unicorns, and companies lacking the money to pay top talents. 

And if you recall from our previous article, we’ve also touched on various other definitions relevant to unicorns like decacorns (which is what Grab is), camels, and also soonicorns, which is what we’ll expand more on today. 

What Is A Soonicorn?

Soonicorns (coined from the phrase “soon-to-be unicorns”) are privately-owned tech startups that have the growth potential and possibility of joining the unicorn club. To qualify for that title, a startup must be primarily funded by an angel investor or venture capitalist. 

Another factor is these tech startups’ ability to scale exponentially. Their tech product should be able to achieve hyper-growth, a phase of rapid expansion when a startup grows at 20-40% CAGR, and doubles the company’s revenues every 3-4 years.

Dictionary Time: CAGR (Compound Annual Growth Rate) is the rate of return that would be required for an investment to grow from its beginning balance to its ending balance. It’s also the most accurate way to calculate and determine returns for anything that can rise or fall in value over time.


When it comes to determining the potential of these startups, it’ll be based on future forecasts about the industry market and firm valuations, which will guide them for a valuation for the business. 

Usually, it always exceeds the real value of the startups. In some cases, larger companies will acquire these startups, which will lead to valuing them above their actual net worth. However, this is a favourable condition to help startups join the soonicorn club earlier and get closer to a US$1 billion asset valuation. 

Tracxn, which usually updates their annual Soonicorn Awards list, selects soonicorns based on market size, investment by marquee investors, execution excellence, and future growth prospects.

Dictionary Time: A marquee investor is either an individual or a corporate/ institutional investor, well-known for investing in companies that turn into success stories at a later date.

Jaideep Shirali, financial consultant

Prior to being soonicorns, these startups will become minicorns first, which is a term given to early-stage startups with valuations over US$1 million (RM4.1 million) and are aspiring to become unicorns. 

The Soonicorn Landscape In Malaysia

In 2020, the local tech startups that made it to the soonicorn list were iflix, Carsome, and Fave. Some of their big-name investors were Catcha Group, Mitsubishi UFJ Financial Group, and Sequoia Capital respectively. iflix was later acquired by Tencent and Fave was acquired by Pine Labs.

At the time this list was created in March 2020, iflix was supposedly the most promising soonicorn, as it had a disclosed funding of US$350 million, followed by Carsome with US$86 million, and Fave with US$32 million. There were over 2.7k tech startups and over 40 public ones.

In 2021 however, only Carsome and Fave remained in the soonicorn club, and Boost joined these 2 market leaders. Carsome topped the chart this time with a disclosed funding of US$116 million, followed by Boost with US$70 million, and Fave with the same valuation. This time, we have over 3.7k tech startups nationally with over 900 public ones, quite a big jump from the previous year according to Tracxn.

You may not be surprised to learn that most of these companies have had to take on quite a bit of losses as well, most notably iflix which as of 2018, had a net loss of US$158.1 million (RM648.5 million) and fell into debt as well. 

In the same year, Carsome also recorded a net loss of RM19.3 million on the back of RM403.7 million in revenue, whereas Fave recorded a net loss of almost US$10 million (RM41 million) at the end of their financial year in December 2019. Fave also remained in the red at US$7.5 million in FY2019, compared to US$7.45 million in FY2018, after nearly 5 years of operations.

While it’s uncommon to see unicorns in debt or even unprofitable, soonicorns are no stranger to the same things as well. 

Is Our Growth Of 3 Soonicorns Worth Celebrating?

To help you gauge our soonicorn game regionally, here’s a list of how many soonicorns these 5 SEA countries had in 2020 (the full list of countries with soonicorns for 2021 isn’t out yet):

Evidently, we’re not as competent as our 4 other SEA neighbours in developing more soonicorns locally. But one can say that the good news is, at least we’re in the soonicorn club, which presents a glimmer of hope. 

Because soonicorns are backed by marquee investors, this list further proves that we’re still not at that level of attracting as many of them to get to where Singapore is, which means funding is still one of the biggest obstacles of entry to the unicorn club for us.

More importantly, this also shows that population can be a hindrance but not a huge blockade to our entering the soonicorn scene, seeing that Singapore’s currently stands at 5.8 million whereas Malaysia‘s is at 32.7 million. Singapore may have a much smaller population, but its GDP per capita is high, meaning a better standard of living for its people and thus bigger spending power.

On the other hand, why then, do countries with lower GDP per capita like Thailand, Vietnam, and Indonesia still succeed in developing unicorns and soonicorns at a faster pace than us? For these cases, it may come down to population growth.

Thailand has a population of 69.9 million, Vietnam has 98 million, and Indonesia has 276 million, and though their spending power may be lower, what they present is a greater market opportunity. Startups there are able to constantly find new customers to cater to as the population grows, which means less competing against incumbent businesses for existing customers. Of course, this growth would be tied to the education of customers on any new products and services too.

As mentioned in our previous piece on unicorns, our government and its agencies are ambitious in their plans to grow or attract unicorns in Malaysia. But rather than aim for the moon, more support should be given to our identified soonicorns in order to maximise their potential in reaching unicorn status.

At the same time, our minicorns shouldn’t be left in the dust, and it would be encouraging to see a more detailed blueprint on what initiatives the government and its agencies can take to keep a laser focus on the growth of our soonicorns and minicorns.

  • You can read more unicorn-related pieces we’ve written here.

Featured Image Credit: Eric Cheng, co-founder & CEO of Carsome / Joel Neoh, founder & CEO of Fave / Mohd Khairil Abdullah, CEO of Boost

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© 2021 GRVTY Media Pte. Ltd.
(UEN 201431998C.)

Vulcan Post aims to be the knowledge hub of Singapore and Malaysia.

© 2021 GRVTY Media Pte. Ltd.
(UEN 201431998C.)