Morningstar Introduces Morningstar PitchBook Unicorn 30 Index

Rhea-AI Summary

Morningstar (Nasdaq: MORN) has launched the Morningstar PitchBook Unicorn 30 Index (UI30), tracking the 30 largest and most liquid late-stage venture capital-backed private companies valued at $1 billion or more. The index, developed through collaboration between Morningstar Indexes and PitchBook, includes prominent companies like SpaceX, Stripe, OpenAI, and SHEIN.

The index employs screens for liquidity challenges and uses a market-driven pricing model combining actual transaction data from multiple secondary market price aggregators. It aims to provide greater transparency and accessibility to the late-stage venture capital market for various investor uses, from benchmarking to investable product creation.

According to Morningstar, venture capital now represents 9% of the global equity market, up from 2% a decade ago, highlighting the growing importance of private markets in the global economy.

Positive

• Launch of new index providing access to high-growth unicorn companies
• Index includes major private companies like SpaceX, Stripe, OpenAI, and SHEIN
• Addresses liquidity challenges through specialized screening methods
• Leverages PitchBook's extensive private capital market data

Negative

• None.

Insights

Financial Market Analyst

The introduction of the Morningstar PitchBook Unicorn 30 Index marks a pivotal shift in private market accessibility. This innovative index addresses a critical gap in the market by providing daily visibility into the performance of elite unicorns like SpaceX, Stripe, OpenAI and SHEIN.

The timing is particularly strategic, as venture capital-backed companies now represent 9% of global equity markets - a remarkable increase from 2% a decade ago. This growth underscores the increasing importance of private markets in portfolio diversification and return generation.

The index's sophisticated market-driven pricing model, which aggregates actual transaction data from multiple secondary market sources, represents a significant advancement in private market valuation methodology. This approach helps solve one of the primary challenges in private market investing: accurate and timely pricing discovery.

For institutional investors, this index could serve as a important benchmarking tool for their private market allocations. For product developers, it opens new possibilities for creating investment vehicles that track private market performance, potentially leading to ETFs or other structured products that provide broader market access to private equity investments.

However, investors should note potential limitations: secondary market pricing may not always reflect true company values and the concentrated nature of the index (30 companies) could lead to higher volatility. Additionally, while the index improves transparency, the underlying companies remain private, with disclosure requirements compared to public companies.

Market Structure Specialist

The UI30 index represents a breakthrough in private market infrastructure, establishing a standardized framework for tracking unicorn performance. The index's architecture, combining PitchBook's extensive private market data with multiple secondary market price sources, creates a more robust and reliable pricing mechanism than previously available.

From a market structure perspective, this development could catalyze increased secondary market trading activity in private company shares. The daily calculation frequency and focus on liquidity could help establish more efficient price discovery mechanisms for private company valuations, potentially reducing the illiquidity discount typically associated with private market investments.

The emphasis on investability through liquidity screening is particularly noteworthy. This feature addresses a fundamental challenge in private market investing - the ability to enter and exit positions efficiently. By focusing on the most liquid unicorns, the index creates a more practical framework for potential investment product development.

This innovation could lead to a more standardized and transparent private market ecosystem, potentially attracting a broader range of institutional investors who have historically been hesitant to engage with private markets due to liquidity and pricing concerns. The index might also serve as a template for future private market indices, potentially leading to a more comprehensive suite of private market benchmarks.

Morningstar adds to its growing suite of global indexes providing more transparency into the late-stage venture capital market for a range of investor use cases, from benchmarking to investable product creation.

CHICAGO--(BUSINESS WIRE)-- Morningstar, Inc. (Nasdaq: MORN), a leading provider of independent investment insights, today introduces the Morningstar® PitchBook® Unicorn 30 Index (UI30), adding to its expanding suite of market data, research and index tools to help investors measure and access the late-stage venture capital market. Powered by PitchBook’s extensive private capital market data coverage, the new index tracks the 30 largest and most liquid “unicorns,” or late-stage venture capital-backed private companies valued at $1 billion or more, providing investors with access to some of the most innovative and fastest growing companies across developed global markets.

Built for investability, the new index employs screens to address liquidity challenges and is calculated daily with a market-driven pricing model that combines actual transaction data from multiple secondary market price aggregators.

“Private markets continue to grow in scope and investor interest as private companies become a much bigger part of the economic picture. From an individual investor standpoint, however, access to private markets has historically been a challenge, with available investment tools underdelivered,” said Ron Bundy, president of Morningstar Sustainalytics & Morningstar Indexes. “We believe that trend is changing, however, and are excited to help expand the investable universe for all investors through our growing suite of unicorn indexes.”

The Unicorn 30 Index was developed as part of an ongoing collaboration between Morningstar Indexes, the fastest growing global index provider for the last three years, and PitchBook, the leading provider of data, research and tools on global private capital and credit markets. The index provides access to some of the most innovative and fastest growing late-stage venture capital companies such as SpaceX, Stripe, OpenAI and SHEIN. PitchBook’s extensive database is the key input powering the pricing model, enabling investors to track the most promising investment opportunities within the private markets.

“The private capital markets have become a vital engine for transforming industries and global economies. As the private markets continue to become more prominent and influential, PitchBook is the natural leader to drive greater understanding of market activity and enable access to private market investment opportunities to a wider investor base,” said Rod Diefendorf, president and chief operating officer of PitchBook. “Transparency is key to driving this momentum, and indexes like this play a crucial role in fueling innovation, supporting entrepreneurship, and driving market growth.”

Added Sanjay Arya, head of innovation for Morningstar Indexes, “Public equity markets no longer represent the full scope of the global economy. Venture capital, as reflected by the post-money valuation of companies in PitchBook’s venture-backed database, now represents 9% of the global equity market, as represented by the total market value of firms in the Morningstar Global Markets Index, up from 2% a decade ago, making its integration important for investor portfolios. In line with our mission to make it easier for investors to measure and invest in private markets, this is our most liquid and investable unicorn index.”

About Morningstar Indexes

As the fastest-growing global index provider for the last three years according to Burton-Taylor International Consulting, Morningstar Indexes was built to keep up with the evolving needs of investors—and to be a leading-edge advocate for them. Morningstar's rich heritage as a transparent, investor-focused leader in data and research uniquely equips Morningstar Indexes to support individuals, institutions, wealth managers and advisors in navigating investment opportunities across all major asset classes, styles, and strategies. From assessing risk and return with traditional benchmarks to helping investors effectively incorporate ESG objectives into their investment process, our range of index solutions spans an investment landscape as diverse as investors themselves. We help investors answer today's increasingly complex questions so that they can more easily reach tomorrow's goals. Please visit indexes.morningstar.com for more information.

About PitchBook

PitchBook is a financial data and software company that provides transparency into the capital markets to help professionals discover and execute opportunities with confidence and efficiency. PitchBook collects and analyzes detailed data on the entire venture capital, private equity, and M&A landscape—including public and private companies, investors, funds, investments, exits, and people. The company’s data and analysis are available through the PitchBook Platform, industry news, and in-depth reports. Founded in 2007, PitchBook operates globally with more than 3,000 team members. Its platform, data, and research serve over 100,000 professionals around the world. In 2016, Morningstar acquired PitchBook, which now operates as an independent subsidiary.

About Morningstar, Inc.

Morningstar, Inc. is a leading provider of independent investment insights in North America, Europe, Australia, and Asia. The Company offers an extensive line of products and services that serve a wide range of market participants, including individual and institutional investors in public and private capital markets, financial advisors and wealth managers, asset managers, retirement plan providers and sponsors, and issuers of fixed-income securities. institutional investors in the debt and private capital markets. Morningstar provides data and research insights on a wide range of investment offerings, including managed investment products, publicly listed companies, private capital markets, debt securities, and real-time global market data. Morningstar also offers investment management services through its investment advisory subsidiaries, with approximately $328 billion in AUMA as of Sept 30, 2024. The Company operates through wholly- or majority-owned subsidiaries in 32 countries. For more information, visit www.morningstar.com/company. Follow Morningstar on X (formerly known as Twitter) @MorningstarInc.

©2025 Morningstar, Inc. All Rights Reserved.

MORN-P

View source version on businesswire.com: https://www.businesswire.com/news/home/20250121374066/en/

Morningstar Media Contacts:

Tim Benedict, +1 203 339-1912 or tim.benedict@morningstar.com

Orion Sang, Edelman Smithfield, + 734 678-2187 or Orion.Sang@edelman.com

Source: Morningstar, Inc.

FAQ

What companies are included in Morningstar's new Unicorn 30 Index (MORN)?

The index includes 30 of the largest and most liquid late-stage venture capital-backed private companies valued at $1 billion or more, including companies like SpaceX, Stripe, OpenAI, and SHEIN.

How does Morningstar's UI30 index calculate company valuations?

The index uses a market-driven pricing model that combines actual transaction data from multiple secondary market price aggregators and is calculated daily.

What percentage of global equity market does venture capital represent according to Morningstar (MORN)?

According to Morningstar, venture capital represents 9% of the global equity market, up from 2% a decade ago.

How does Morningstar's UI30 index address liquidity challenges in private markets?

The index employs specific screening methods to address liquidity challenges and ensure investability while tracking private market companies.

What is the purpose of Morningstar's new Unicorn 30 Index (MORN)?

The index aims to provide investors with transparency and access to the late-stage venture capital market for various uses, including benchmarking and investable product creation.