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They didn't say they were profitable - they said they were cash-flow positive. And if you look at the cash flow statement in the S-1, they were indeed cash-flow
by jonas21 5y ago
They didn't say they were profitable - they said they were cash-flow positive. And if you look at the cash flow statement in the S-1, they were indeed cash-flow positive in 2019.
It looks like much of the difference comes down to stock-based compensation. This doesn't cost the company any cash, but under GAAP, it has to be recorded as an expense. (IANAA, so take what I say with a grain of salt).
- qeternity 5y agoBackblaze was tweeting about being profitable as late as 2020: https://twitter.com/backblaze/status/1242481625004273665 https://twitter.com/backblaze/status/1242481625004273665
- nl 5y agoThere's a lot of ways to measure "profitable". Judging from their current numbers the service is profitable on a per user basis, less marketing expenses. This is a pretty reasonable way to look at it. Being cashflow positive means you can turn up marketing to grow and turn it down if needed.
- mcny 5y agoCan the service itself be profitable but the company not be? I mean how do we define profitable?
- lmm 5y agoPresumably the employees are working below-market in exchange for equity, so the company is not really profitable yet - it's sort of "ramen profitable" in that it's profitable if you don't count the full rate of the workers' time.
- CameronNemo 5y agoIf the service is provided by employees who are compensated with equity, why would you not count that in profitability numbers?
- dboreham 5y agoBecause that's literally one of the reasons to use equity based compensation.
- asdfaoeu 5y agoThe figures above are with GAAP standards but as a private company do they actually have to use that?