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Growth companies are always in a precarious financial position. That is their nature. Default dead, as pg put it. The goal is to achieve market scale, then make
by beat 7y ago
Growth companies are always in a precarious financial position. That is their nature. Default dead, as pg put it. The goal is to achieve market scale, then make that financial position stable and profitable, rather than precarious and feeding on investment.
- isthispermanent 7y agoAnd if you were to successfully achieve, or begin to achieve, market scale your revenue/income statement would look a lot like this... https://en.wikipedia.org/wiki/Tesla%2C_Inc.#/media/File:Tesla_Financial_Performance.svg https://en.wikipedia.org/wiki/Tesla%2C_Inc.#/media/File:Tesl... It took Amazon about 12 years to get to the same revenue/income balance... http://infographic.statista.com/normal/chartoftheday_4298_amazons_long_term_growth_n.jpg http://infographic.statista.com/normal/chartoftheday_4298_am...
- bb822 7y agoSure maybe it would look like that if Tesla were in fact Amazon. But Tesla makes cars, they don't sell tablecloths and rent servers. There is very high operating leverage in Automotive manufacturing. Hence why this cycle continues forever: Elon: That's it, we don't need to raise anymore outside capital! 9 months later: Insert equity/bond/convert raise here.