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A company with no revenue can potentially raise at a higher valuation with a company of $1 of revenue - because now it’s real and investors will start making th
by robbiep 4y ago
A company with no revenue can potentially raise at a higher valuation with a company of $1 of revenue - because now it’s real and investors will start making their mind up about the actual possiblities of the investment
- foobiekr 4y agoDirectly experienced this - having actual _profit_ makes it hard to encourage fantastical storytelling about how big the upside is. It's the company future equivalent of mark-to-market. Revenue .. well, if you can get huge revenue with huge losses and convincingly demonstrate (mostly by spending) that more losses (= more capital) means more revenue can actually take you a long way. Almost all of the "unicorns" and "decacorns" embraced this model - lose $2-5 per $ of revenue but able to demonstrate almost unlimited market. Most of those companies can never, ever be profitable entities.