San Francisco-based TRAC has used a proprietary AI model to generate a fresh list of early-stage startups it predicts are most likely to become unicorns, or companies valued at more than a billion dollars. And two companies from its last list have already exploded into $11 billion juggernauts.
The list included two relatively unknown companies at the time that are now among the hottest startups in venture: Harvey, a legal tech startup, and Kalshi, a prediction market, both valued at $11 billion.
TRAC’s model, which the firm calls “Moneyball for venture capital,” is based on over 30 sources of both public and private data. The model starts by identifying the many startups unlikely to succeed rather than picking winners.
“We don’t look for needles in the haystack,” explained Joe Aaron, TRAC’s cofounder and managing partner. “We remove the haystack.”
TRAC has found that a company’s founders do not predict success. Instead, its algorithm prioritizes 286 top investors.
“These extraordinary investors make a profit on two-thirds of their positions and one in five of their investments returns over 10X,” Aaron explained.
Less than 2% of all startups attract these elite investors, so that eliminates over 98% of all startups from TRAC’s formula.
The firm says the companies it identifies have a one-in-five probability of becoming a unicorn. Advances in AI make this year’s list more accurate than ever, but that is not necessarily good news for investors.
“It is easier today for our AI to identify future unicorns than ever before,” said Fred Campbell, TRAC’s managing partner. “Conversely, it is harder than ever to secure allocation in funding rounds of the fastest-growing future unicorns.”
That is because so many VCs are chasing the hottest companies. The hard part is not identifying the companies, but getting founders to accept a check.
“Competition to invest in the ‘hot’ companies is as fierce as we’ve seen in decades,” Campbell said. “TRAC is seeing investor demand exceed round sizes by 10X, meaning for every $1 the company wants to raise, investors are offering $10.”
Companies are raising so quickly that, in the weeks Business Insider was working on the list, five companies fell off because they raised new funding at valuations above $1 billion.
Before any more startups graduate, here is the updated list of 30 companies in 2026, identified by TRAC’s model, in alphabetical order.