Clearing the hurdles to unicorn status

Achieving unicorn status – when a company’s value reaches $1 billion – is a dream for many businesses. The journey to this milestone is rarely linear, and each achiever has a unique story to tell. What lessons can be learned from two of the pet sector’s current unicorn companies?

Long-term defensibility and discipline

To find out more about what it takes to achieve – and subsequently maintain – unicorn status in the pet sector, PETS International spoke to two of the industry’s current unicorn companies: ManyPets and Pet Circle. They both reached this milestone in 2021.

Based in Sydney, Australia, Pet Circle operates an online platform offering multi-category pet supplies including food, toys, medication, clothes, training and grooming accessories, as well as tech products and vet plans. A spokesperson for Pet Circle says that reaching unicorn status was the result of investing heavily in technology, logistics and customer experience long before the market demanded it.

“There wasn’t one defining moment – it was a series of strategic steps that compounded,” says Pet Circle’s representative. “Securing major supplier partnerships and proving we could lead in high-growth categories all reinforced that we were building a business with long-term defensibility. That discipline is what pushed us into unicorn territory.”

Tech-driven innovation

ManyPets is also an online platform, although it specializes in providing pet insurance. Based in London, UK, it has a current valuation of $2 billion (€1.74B). The focus is on bringing a customer-centric, digital-first approach that enables better pricing and user experiences.

Luisa Barile, Group CEO at ManyPets, says reaching unicorn status was an exciting milestone and a strong sign that its proposition was solving real problems for pet parents. However, she adds that she personally places greater value on the fundamental metrics of business health, rather than the value investors attribute to it at a specific point in time.

“For us, these [fundamentals] relate to three key areas: our insurtech and business credentials, our strong customer focus, and creating an environment for our people to thrive and grow their careers – all of which are underpinned by tech-driven innovation,” says Barile.

Future-ready with a low cost base

“Investing in technology and being data-driven means we have a stable, well-managed loss ratio, low operating expenses and highly efficient processes – which in turn means we can focus more on innovating in ways to benefit our customers,” comments Barile.

While becoming a unicorn made her proud, Barile says she is even prouder that ManyPets delivered its first annual profit in the last financial year. For the year ending March 2025, the overarching ManyGroup reported a net profit of £6.25 million ($8.31M/€7.24M).

This result, she explains, was driven by strategy. ManyPets invested in technology and built its own scalable proprietary insurance platform for policy administration. This infrastructure enables the business to keep its cost base low and be future-ready.

Data-enhanced approach

One key differentiator is that ManyPets is entirely data driven and has a unified, accessible data warehouse. According to the Group CEO, this enables the company to leverage valuable insights – from understanding customer retention better to supporting its underwriting decisions.

“Where more traditional insurers would look at data in a siloed way, we take a much broader approach for richer insights,” she states.

Agility to tackle challenges

The journey to reaching a $1 billion valuation is unlikely to play out without its challenges. Barile says one of ManyPets’ biggest hurdles was ensuring that its operational backbone could grow in line with the expectations of a rapidly expanding customer base.

“Technology-driven innovation has always been part of our DNA, which we’ve maintained as we’ve grown, and this agility has been a core part of our success: improving efficiency in our operations, reducing our internal costs and supporting our journey to becoming profitable,” explains Barile.

Rollout of AI initiatives

As recent examples of tech-driven innovation at ManyPets, she mentions the rollout of AI initiatives across the business. These range from streamlining claims handling, to building AI-driven predictive models to identify fraud and creating AI agents to answer employees’ queries based on internal policies.

“We have successfully moved from a fast-moving scale-up to a more mature, resilient organization by strengthening our leadership, professionalizing our processes and building more robust infrastructure – particularly in underwriting, claims and customer service,” adds Barile.

Growth pressure is a signal to invest

Pet Circle understands the need to balance growth with infrastructure changes. Rather than viewing growth pressures as obstacles, it treated them as a signal to invest in a new digital platform, a national fulfilment network and automation across its operations.

“These opportunities pushed us to build a business with stronger systems, faster delivery and deeper capability across complex categories such as pharma and fresh food,” says Pet Circle’s spokesperson. “The result is a far more resilient and scalable organization, well positioned for the next phase of acceleration.”

Springboard to maturity

Since reaching unicorn status, Pet Circle has matured into a scale-up with the operational strength, infrastructure and category breadth to be a leader in the Australian pet care market. The business now offers more than 17,000 SKUs, has built dedicated supply chain capabilities for chilled and fresh food, and its fulfilment network delivers next day to more than 80% of Australians.

The brand has also rebuilt its technology from the ground up, launching a new website, integrating AI to improve the customer experience, and introducing automation into warehouses to increase accuracy and speed.

Investing in change

At ManyPets, becoming profitable meant major changes to its operations, including restructuring the company’s claims and customer service teams and migrating policy administration to its proprietary insurance platform.

“We’ve also invested heavily in technology, allowing us to operate differently from traditional players,” explains Barile. “Automation has been embedded across almost every layer of the business. More than 50% of our claims are now fully automated, streamlining the service for customers and freeing up our agents to spend time with customers on more complex claims.”

Three challenges to scaling

Many startups in the pet sector will look to unicorns like ManyPets and Pet Circle as inspiration for their own goals. But in a challenging economy and investor environment, what is the state of play for pet businesses reaching for the stars?

Angela Jones is an equine vet and co-founder of Petscribers, a UK-based search engine for pet medication. She outlines three key challenges to scaling: a fragmented, slow-moving veterinary regulatory landscape and infrastructure; slow and cautious market adoption of new tech; and a European funding environment that undervalues pet health innovation.

“Veterinary practices are busy, risk-averse and often understaffed,” says Jones. “Even when a solution is a clear improvement, decision-making can be slow. Adoption typically requires extensive relationship-building, onboarding and training. This can create long sales cycles that limit the rapid revenue growth often required for unicorn valuations.”

Investor caution in Europe

Jones says that while achieving unicorn status requires access to large-scale capital, European investors have historically been more cautious about pet tech compared to their US and Asian counterparts. Many still see the sector as niche, despite its rapid growth. This means fewer late-stage funding rounds and lower valuations, with European founders often facing more barriers at Series B and beyond.

“European investors prioritize profitability and capital efficiency, leading to conservative funding rounds,” she adds. “In contrast, US and Asian investors take bigger, riskier bets on scale, enabling companies to reach billion-dollar valuations quickly. This gap in capital appetite and market size is why European pet tech often exits below $1 billion, despite strong fundamentals.”

The importance of trust and welfare

Axel Lagercrantz is CEO and co-founder of Pet Media Group, a network of online marketplaces that connects users with trusted breeders. He says that there are some real structural challenges to building unicorn scale companies in pet tech, including fragmented markets and regulation, and a high bar for trust and welfare.

“Long-term value hinges on trust: from breeders, from adopters and from regulators,” states Lagercrantz. “Implementing ID verification, secure payments and proactive welfare controls is expensive and often suppresses some short term volume, but it’s non-negotiable. The trade-off is that you grow more steadily, but perhaps not at the hyper growth trajectory of some other unicorns.”

Lagercrantz points out that “Europe alone is a patchwork of regulatory regimes, and the US adds a second layer of state-by-state complexity”. He concludes: “Our view is that unicorn status [in the pet industry] will increasingly be reserved for companies that can prove both genuine impact on welfare and trust, and scalable, profitable economics.”

Maintaining unicorn status

Over the next five years, Pet Circle believes more businesses will reach unicorn scale in pet care. They will do so thanks to investing in logistics, personalization, automation and the ability to service complex categories at speed.

“But only those with robust infrastructure and a customer-first operating model will maintain that position,” Pet Circle’s spokesperson says. “Demand for premium pet care, fresh and therapeutic diets, and fast, reliable delivery will continue to grow. Companies that can deliver all three will lead the sector.”

Barile’s advice for European pet companies who are struggling to scale at pace is simple: “Stay close to your customers – ensure your proposition resonates fully with them, and make sure your infrastructure allows you to scale, test and adapt as needed,” she says. “A strong data capability is critical to this.”