I find noticeable bunching in the distribution of private company valuations. Companies strategically authorize more shares for future employee compensation (e.g., stock options) to achieve unicorn status (valuation of $1 billion or higher). Regression discontinuity design suggests that achieving unicorn status makes employees more favorably assess the companies they work for. Textual analysis shows that increased satisfaction with compensation, including stock options, is the main reason. Inflating valuations to achieve unicorn status, however, lowers the expected value of employee stock options. Providing simple stock option payoff diagrams to employees can reduce information frictions.