Unicorns from emerging economies have a significant impact on entrepreneurial ecosystems locally, regionally and globally; however, little is known about these privately held entities. This chapter presents the analytical framework that brings the research in this book together; it is meant as a structured system for understanding the forces of the distal and proximal environments under whose influence unicorns emerge. The building blocks of the proposed analytical framework include: macro trends, such as the health of the global economy; geopolitical power balance and the race for technological superiority; the elements of the local entrepreneurial ecosystem; and the specific characteristics of unicorns. To a degree, these all enable opportunities for accelerated growth to arise within the context of the emerging economies of the Global South.

Chapter 1 critically examines why corporate law traditionally excludes family relationships from its analytical framework. Despite the prevalence of family businesses, legal scholarship has largely overlooked their unique dynamics, often framing them solely through the lens of economic rationality. This chapter explores the dominant influence of law and economics in corporate law, emphasizing the firm as a nexus of contracts designed to minimize transaction costs. From this perspective, family ties are treated as economically rational mechanisms rather than intrinsic social bonds. This approach often disregards the complex interplay between familial motivations and business decisions. The chapter also critiques the limitations of the economic model, highlighting how the failure to account for family relationships may lead to inadequate legal responses to disputes within family-owned firms. Through this analysis, the chapter calls for a more nuanced understanding of family businesses within corporate law.

A significant percentage of listed companies are under the influence of founding families by stock ownership and/or family managers, even in developed countries, including the United States. In the United States, when the founders retire, they tend to hire professional managers and sell out their shares. In Japan, approximately 50% of listed companies are family firms, many of which are managed by founders’ heirs without substantial family ownership. In China, although family firms are relatively new because Chinese law traditionally prohibited private enterprises, family firms have grown rapidly since the transformation from a planned to a market-oriented economy in 1978. Generally speaking, founder firms’ performance is significantly better than that of non-family firms in most countries, but heir-managing firms’ performance varies in different countries. Prevalent types of listed family firms and their relative performance to non-family firms reflect minority shareholder protection law, the size of the manager market, and the corporate governance practice of each country.

Chapter 10 tackles the intersection of family business ownership and wealth inequality, investigating how family-controlled enterprises can both perpetuate and alleviate economic disparities. While wealth concentration through inheritance challenges democratic ideals, family businesses also offer pathways for social mobility, particularly for immigrant and minority communities. This chapter analyzes the dual role of family businesses as both drivers of inequality and mechanisms for opportunity, emphasizing the nuanced relationship between kinship, capital accumulation, and social advancement. Through case studies, the chapter highlights how family businesses can blend community responsibility with entrepreneurial resilience. The chapter concludes that rather than condemning or celebrating family business models in isolation, policymakers should consider the broader social and economic contexts that influence their impact on inequality.

This chapter introduces the concept of ‘unicorns’ as exceptionally successful privately held start-ups that have reached a valuation of US$1 billion, and succinctly describes the most prolific entrepreneurial ecosystems from emerging economies per number of unicorn ventures. Providing an overview of the transformational force of these high-impact ventures, unicorns are portrayed as symbols of extraordinary growth and innovation in the digital age, garnering substantial disruptive potential and attention from investors, media, politicians and the general public. The chapter highlights the importance of unicorns not only as economic powerhouses but also as sources of inspiration and impact for entrepreneurs, investors and the broader business community, through an exploration of the factors that have influenced their development in the emerging entrepreneurial ecosystems of the Global South. Our focus is on China, India, Southeast Asia, Eastern Europe and Russia, Latin America, MENA and Africa; subsequent chapters of this book analyse these regions in detail.

Chapter 7 explores the challenges and opportunities associated with improving corporate governance in family businesses, emphasizing the need for legal and structural adaptations to better serve the unique intersection of family and business values. The chapter proposes the development of a specialized business entity – the “F Corp” – designed specifically for family businesses, incorporating best practices such as independent board committees, retirement age policies, and clearly defined family and nonfamily management roles. Additionally, the chapter advocates for judicial reform to ensure fiduciary duties in succession planning and capacity evaluations, as well as the active role of third parties, including lenders and key nonfamily employees, in governance stability. By examining both legislative initiatives and private ordering strategies, the chapter offers a comprehensive framework to mitigate the governance challenges unique to family-owned enterprises.

This chapter examines the emergence of unicorn firms in Latin America, focusing on the interplay between local entrepreneurial ecosystems and firm strategies. Using an entrepreneurial ecosystem approach, we integrate the dual significance of tangible ecosystem resources (e.g., human capital, funding) and intangible digital assets (e.g., digital platforms and linkages) in driving firm success. We also analyse how national and local ecosystems in Argentina, Brazil, Colombia, Mexico and Peru impact the development of these high-growth firms. We identify strategies entrepreneurs use to leverage available resources and navigate institutional obstacles, emphasising the role of digital ecosystems in scaling operations beyond local boundaries. Our findings contribute to understanding the dynamics of unicorn emergence in Latin America and offer theoretical and practical insights into how entrepreneurs overcome institutional challenges and leverage digital strategies to achieve global or regional impact.

Chapter 5 compares laws of employment protection, compensation, and labor unions in the three countries, and describes how the different laws affect incentive bargaining of the firm and corporate governance. The US employment-at-will rule gives employers almost complete discretion to dismiss employees unless there are either contractual protections or discrimination. The Japanese abusive dismissal rule strictly restricts employers’ discretion in dismissing employees even in business downturns. Relative to Japanese companies, the US companies rely heavily on performance-based pay, which includes generous stock options. Among the compensation packages in China, the portion of payment for social insurance and welfare benefits is large. Performance-based bonuses play a significant role in privately owned enterprises (POEs). The US labor unions are basically industry unions and adversarial to management, while Japanese labor unions are company unions and are rather agreeable to management. All labor unions in China are government-backed, organized only on individual enterprises, and expected to mitigate labor disputes.

On the basis of the previous chapters, we summarise the dimensions along which unicorns from developed and emerging economies differ, recognising the relative strengths of the constituent elements of the entrepreneurial ecosystems of China, India, MENA, Africa, Latin America, Southeast Asia, Central and Eastern Europe and Russia as described in this book. This overview serves as a point of departure for researchers and policymakers in further assessing and understanding the transformational potential of unicorns for countries of the Global South. We offer a list of conjectures that require additional data, analysis and validation to find an answer to the overarching question: Will unicorns from emerging economies be able to materialise into significant and tangible economic and social improvements?

Chapter 3 examines how family and business values intersect in family-owned enterprises and explores the integration of contractual principles to harmonize these dual expectations. The chapter critiques the simplistic status-to-contract thesis, which presumes a rigid divide between inherited roles and freely negotiated agreements. In family businesses, both concepts coexist and interact, as relationships often blend personal obligations with business governance. The chapter advocates for a nuanced legal framework that recognizes family roles as integral to contractual arrangements, rather than seeing them as distinct or opposing forces. Through concepts like shareholder voice and inclusive governance, it proposes legal principles that respect familial ties while also accommodating entrepreneurial adaptability. Case studies illustrate how integrating status-based and contractual perspectives can improve decision-making and reduce conflict, ultimately fostering resilience in multigenerational family firms.

Chapter 6 addresses the critical challenge of succession in family-owned businesses, emphasizing the importance of planning and structured decision-making to ensure long-term stability. Drawing from both legal theory and real-world case studies, the chapter discusses how trusts, inheritance contracts, and carefully negotiated governance structures can facilitate smooth transitions of power. It highlights the complex interplay between family dynamics and business imperatives, illustrating how the failure to separate personal identity from leadership can jeopardize succession. Through comparative analysis, including insights from Shakespeare’s King Lear and the television series Succession, the chapter elucidates common pitfalls when leadership transitions are handled unilaterally or without sufficient stakeholder involvement. The case study of Sharp & Sharp Certified Seed exemplifies a pragmatic approach, demonstrating how early, inclusive planning and open communication between generations can overcome the challenges inherent in family business succession.