The 2025 government work report stressed the need to “support the development of unicorn and gazelle enterprises.” Gazelle companies typically refer to small and medium-sized innovation-driven tech firms that have survived the early “valley of death” and entered a stage of rapid growth, with strong potential to develop into unicorns. Unicorn enterprises represent the next advanced stage, generally defined as unlisted companies less than 10 years old, with valuations exceeding $1 billion, and characterized by proprietary core technologies, unique competitive advantages, and great market potential. At present, however, only a small number of gazelle enterprises succeed in becoming unicorns, due to constraints in five key areas: technology, capital, talent, application scenarios, and ecosystem.

The first constraint is inefficient technology transfer. Currently, nearly 70% of unicorns are frontier tech companies, making high-quality innovation and the successful commercialization of research critical for a gazelle’s transition to unicorn status. According to the 2022 China Patent Survey Report, only 16.9% of invention patents held by Chinese universities were implemented, and just 3.9% were industrialized—hindering the efficient transformation of scientific achievements into market-ready technologies. In addition, there is a mismatch between technology supply and demand—research outcomes from universities and institutes often remain at the theoretical stage, while their capacity to respond to real-world technical challenges faced by enterprises remains limited.

Second, funding continuity is insufficient. Although many gazelle enterprises have secured early-stage investment, scaling up to unicorn level requires significantly more capital to support rapid and sustained growth. Under current complex economic conditions at home and abroad, Chinese gazelles face great financing challenges. In particular, US restrictions on outbound investment—prohibiting American capital from entering China’s quantum computing, semiconductor, and AI sectors—have significantly affected financing channels for gazelles in these strategic fields.

Third, talent support remains inadequate. In the current context of interdisciplinary and cross-industry development, gazelle enterprises face growing demand for versatile talent, yet their capacity to attract and recruit high-caliber entrepreneurial professionals remains limited. According to the Report on Research and Development of Digital Talent in Industries (2023), China’s digital talent gap ranges between 25 to 30 million, with a pressing need to increase supply in emerging fields like AI and management expertise. In certain cutting-edge sectors, university curricula often lag behind technological advancements, leading to mismatches between graduate capabilities and actual industry needs—impeding gazelles’ high-quality development.

Fourth, the lack of application-driven momentum presents another challenge. As adopters of new technologies and pioneers of new business models, gazelle enterprises rely heavily on real-world application scenarios for growth. Government support is needed in areas such as scenario planning, resource sharing, and policy alignment to help these firms expand their markets and scale efficiently. In AI, for instance, most applications are currently concentrated in a few major domains, while other promising areas—such as smart factories, intelligent homes, precision agriculture, autonomous driving, AI-assisted diagnosis, smart education, and digital supply chains—remain underdeveloped. Limited access to such scenarios add difficulties for gazelle companies to participate.

Fifth, the overall innovation ecosystem is suboptimal. A regulatory approach balancing tolerance and prudence, coupled with a failure-tolerant innovation culture, is essential for fostering gazelle growth. China’s current innovation ecosystem suffers from being “present yet unrefined, comprehensive yet imprecise, reformed yet ineffective,” necessitating smoother circulation of tech, industry, capital, talent, and other innovation factors. Emerging sectors, in particular, face standardization gaps—for example, commercial space ventures encounter approval bottlenecks due to absent industry standards, while L4 and L5 autonomous driving struggles with regulatory shortfalls—constraining gazelles’ market expansion.

Shi Junwei (professor and deputy dean) and Huang Shasha are from the School of Business Administration at Zhongnan University of Economics and Law.