The three major virtuous cycles help Chinese unicorn companies achieve sustained growth

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■ Tian Peng

On March 29, the “China Unicorn Enterprises Development Report (2026)” was released at the Global Unicorn Enterprises Conference. The data show that in 2025, China had 416 unicorn enterprises, with a total valuation of about $1.6 trillion. Over the past three years, China’s unicorn enterprises have shown steady improvement in number, total valuation, and average valuation—the number increased by 12.7%, total valuation rose by 14.6%, and average valuation also reached a three-year high.

In my view, against the backdrop of global technological innovation entering a period of dense and active development, the reason China’s unicorn enterprises have displayed strong resilience and vitality is that three major virtuous cycles are accelerating their formation. The three reinforce one another and together lay a solid foundation for the sustained growth of China’s unicorn enterprises.

The first cycle is an internal closed loop of “R&D investment—technological breakthroughs—iterative optimization,” which addresses the question of “how to become stronger.” By continuously increasing R&D investment, companies concentrate their efforts to tackle core technical challenges. After achieving breakthroughs, they convert technological achievements into products, then continuously optimize products and technologies based on market feedback, thereby driving a new round of R&D investment and forming a self-driven iterative cycle.

Take Unitree Robotics as an example. The company has continuously increased its R&D investment, focusing on joint motor technology and dynamic balancing algorithm breakthroughs, and integrating model predictive control and reinforcement learning algorithms to enable robots to perform complex motions such as ballet and Chinese kung fu.

This internal cycle helps enterprises continuously strengthen their technical foundation and enhance their core competitiveness. Even when facing intense global technological competition and market fluctuations, they can still rely on technological advantages to stand firm, laying a solid foundation for subsequent industrialization and rollout as well as capital matching.

The second cycle is a coordinated closed loop of “patient capital—technology R&D—industrialization and commercialization,” which addresses the question of “how to grow with money.” Patient capital precisely matches the R&D needs of hard-tech companies, providing long-term funding support. Companies use the funding to achieve technological breakthroughs and promote the industrialization and commercialization of technological achievements, forming scaled revenue. After successful commercialization, it attracts even more patient capital to enter, enabling two-way empowerment between capital and technology.

In recent years, China’s capital market reforms have continued to deepen, opening efficient exit channels for hard-tech unicorn enterprises and allowing patient capital to not only “invest in effectively,” but also “exit when needed,” further stimulating capital to flow toward hard technology. Continuous capital injections help hard-tech enterprises gradually break through technological bottlenecks and achieve scaled mass production, forming a virtuous closed loop of “capital escorting technology, technology driving industries, and industries attracting capital,” injecting stable momentum into the growth of unicorn enterprises.

The third cycle is a linked closed loop of “policy guidance—market support—ecosystem optimization,” which addresses the question of “how to optimize development conditions.” National policies clearly define development directions, provide support, and guide the optimization of the industrial ecosystem. The optimized ecosystem attracts companies, capital, and talent to cluster, activating market demand and application scenarios. The market’s commercialization and monetization then feeds back into enterprises’ R&D, further strengthening the effectiveness of policy implementation, forming an all-around support system.

Top-level design points the way for the development of hard technology. “Cultivating unicorn enterprises” has been included in the “Government Work Report” for two consecutive years. The “14th Five-Year Plan” for national economic and social development of the People’s Republic of China explicitly proposes “improving long-term capital support policies for early investment, small investment, long-term investment, and investment in hard technology,” and a series of policies releases stable expectations.

At the same time, China has the world’s most complete manufacturing system and an enormous consumer market, providing abundant application scenarios for the transformation of hard-tech achievements. Technologies such as artificial intelligence and new energy new materials are rapidly being adopted in fields like intelligent manufacturing, smart healthcare, and the new energy sector, helping companies realize commercialization and monetization. This enables enterprises to increase R&D investment and optimize product and service offerings. The cluster effect significantly reduces companies’ innovation costs. A good ecosystem in which upstream and downstream companies innovate in coordination and share resources not only attracts more enterprises, capital, and talent to cluster, but also further strengthens policy implementation effectiveness and market support, forming a virtuous cycle of “policy-guided ecosystem, ecosystem activating the market, and market feeding back into innovation.”

Today, global technological competition has entered deep waters, new quality productive forces are being accelerated into cultivation, and China’s unicorn enterprises are standing at a new window of development opportunities. In the future, as long as the three major virtuous cycles are continuously strengthened, driving further breakthroughs in technological innovation, further完善ing of the capital ecosystem, and further coordination between policy and market, China’s unicorn enterprises will surely go further, more steadily, and farther along the global innovation track.

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责任编辑：Gao Jia